Kernel Holding S.A.

Annual Report • Oct 3, 2025

KERNEL HOLDING S.A. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 1 www.ker nel.ua Kernel Holding S.A. ANNUAL REPORT For the year ended 30 June 2025 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 2 www.ker nel.ua Kernel is a diversified, vertically integrated agricultural business, the largest exporter of agricultural products from Ukraine. We are the world’s leading producer and exporter of sunflower oil, the largest grain exporter from Ukraine, the operator of an exten- sive agricultural logistics network, and the leading producer of grain and oilseeds in Ukraine. In FY2025, we supplied 8 million tons of agricultural products from Ukraine worldwide. 90-99 Corporate Governance 100-158 Financial Statements 100 Independent Auditor’s Report 107 Statement of Management Responsibilities 108 Selected Financial Data 109 Consolidated Statement of Financial Position 110 Consolidated Statement of Profit or Loss 111 Consolidated Statement of Profit or Loss and Other Comprehensive Income 112 Consolidated Statement of Changes in Equity 113 Consolidated Statement of Cash Flows 114 Notes to the Consolidated Financial Statements 158 Corporate Information 1-38 Management Report 3 Key Highlights 4 Chairman’s Statement 7 Our Business Model 8 Kernel at Glance 9 Financial Performance in FY2025 13 Segment Performance 13 Oilseed Processing 19 Infrastructure and Trading 25 Farming 30 Risk Management 35 Alternative Performance Measures 39-89 Sustainability Statement Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 3 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Key Highlights USD million except ratios and EPS FY2024 FY2025 y-o-y Income statement highlights Revenue 3,581 4,115 15% EBITDA 1 381 466 22% Net profit attributable to equity holders of Kernel Holding S.A. 168 238 42% / EBITDA margin 10.6% 11.3% 0.7pp Net margin 4.7% 5.8% 1.1pp EPS, USD 0.65 0.81 24% / Cash flow highlights Operating profit before working capital changes 604 434 (28%) Change in working capital (21) (103) 4.8x Finance costs paid (78) (46) (41%) Income tax paid (32) (44) 36% Net cash provided by operating activities 472 242 (49%) Net cash used in investing activities (113) (40) (64%) / Liquidity and credit metrics Net interest-bearing debt 281 143 (49%) Commodity inventories 2 247 299 21% Adjusted net debt 3 34 (155) n/a Shareholders' equity 1,865 2,078 11% / Net debt / EBITDA 0.7x 0.3x (0.4x) Adjusted net debt 3 / EBITDA 0.1x (0.3x) (0.4x) EBITDA / Interest 5.5x 14.4x 8.9x / Non-financial highlights Number of employees (full-time equivalent) as of 30 June 4 10,904 10,760 (1%) Rate of recordable work-related injuries, accidents per million worked hours 0.76 0.85 12% Social spending, USD million 25.1 30.4 21% Total GHG emission, thousand tons of CO 2 equivalent 3,022 2,044 (32%) Total energy consumption, thousand gigajoules 9,456 9,417 (0%) Note : The financial year ends on 30 June. 1. Hereinafter, EBITDA is calculated as profit from operating activities, adding back depreciation and amortization. 2. Commodity inventories are inventories such as corn, wheat, sunflower oil, and other products that were easily convertible into cash before the Russian invasion of Ukraine given their commodity characteristics, widely available markets, and the international pricing mechanism. The Group used to call such inventories “Readily marketable inventories”, but after the beginning of the war in Ukraine the Group faced difficulties selling such inventories, and therefore such inventories cannot any longer be considered readily marketable. 3. Adjusted debt is the sum of short-term interest-bearing debt, current maturities of long-term interest-bearing debt, long-term interest-bearing debt and lease liabili- ties, less cash and cash equivalents, and commodity inventories at cost. 4. Excluding employees related to assets held for sale as of the reporting date. Hereinafter differences between totals and sums of the parts are possible due to rounding. Hereinafter “Kernel” or “Group” refers to the Kernel Holding S.A. group of companies, while “the Company” refers to Kernel Ho lding S.A. as the Group’s parent entity. This Management Report together with the “Sustainability Statement” and “Corporate Governance” sections shall be read and perceived as Directors’ Report for the purposes of the Luxembourg legislation. …………………………………………………………………… Net debt / EBITDA …………………………………………………………………… EBITDA USD million 1.0x 6.8x 1.1x 0.7x 0.3x FY2021 FY2022 FY2023 FY2024 FY2025 …………………………………………………………………… Net cash generated by operating activities USD million 806 220 544 381 466 FY2021 FY2022 FY2023 FY2024 FY2025 460 (305) 716 472 242 FY2021 FY2022 FY2023 FY2024 FY2025 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 4 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Chairman’s Statement Andrii Verevskyi Chairman of the Board of Directors, Founder 1 if adjusting the FY2024 result for one-off impairments and other material nonrecurring items. Dear Stakeholders, On behalf of the Board of Directors of Kernel Holding S.A., I am pleased to present the re- sults and key developments of the Group for the financial year ended 30 June 2025. The Group delivered EBITDA of USD 466 million, down 16% y-o-y if adjusting the FY2024 result for one-off impairments and other material nonrecurring items. Net profit attributable to shareholders amounted to USD 238 million, and the Group ended the year with a net debt- to-EBITDA ratio of 0.3x, reflecting our cautious indebtedness approach. FY2025 highlights The FY2025 marked our fourth year of oper- ations under the extreme conditions of a full- scale war in Ukraine. The stability of the Black Sea export corridor was pivotal to our performance. We were fortunate that our as- sets were spared from damage, an outcome for which we credit the heroic efforts of the de- fenders of Ukraine. They protect our people, our operations, and the country's economic lifelines, and we extend to them our deepest gratitude. Thanks to these circumstances, Kernel successfully exported 8.0 million tons of agricultural goods from Ukraine in FY2025, matching the previous year's result, contributing to global food security while also standing as the country's largest overall ex- porter. The market environment in FY2025 proved exceptionally challenging. Our operations were constrained by a tight supply of grain and oilseeds in Ukraine, the result of a poor har- vest and depleted carry-over stocks. This scarcity was severely exacerbated by a shift in farmers' selling strategy. Unburdened by li- quidity pressure and with sufficient storage ca- pacity, producers aggressively withheld crops, speculating on future price increases. These highly atypical selling patterns fueled intense competition for grain and oilseeds and directly eroded our margins throughout the year. The support from elevated global prices was mod- est and insufficient to meaningfully offset the profound negative impact of these domestic market dynamics. The performance of our Oilseed Processing segment starkly reflected the hostile market environment, with EBITDA collapsing by 34% y-o-y 1 to USD 148 million. This was a direct consequence of deteriorating crush margins, driven by a 20% drop in Ukraine’s sunflower seed harvest to 11.8 million tons. This created a severe structural deficit, with domestic crushing capacity exceeding the available raw material supply by an estimated 8.5 million tons. This market imbalance forced us to abandon our long-standing single-crop model and begin processing soybeans and rapeseed for the first time. The transition has been challenging, introducing significant operational complexi- ties we had not previously faced. We view this, however, as an irreversible and necessary ad- aptation to the new supply-demand reality in Ukraine. While we have made progress, our ability to efficiently manage three crops is still developing. The first full-year contribution from our new western Ukraine plant helped lift total processed volumes by 8% to 3.5 million tons, including 314 thousand tons of soybeans, po- sitioning Kernel among the largest soybean processors in Ukraine. We kept our plants run- ning at a high 87% utilization rate, but this fig- ure masks the underlying weakness, as we were forced to process lower-margin crops to maintain a minimum positive contribution. Nevertheless, we maintained our leadership as Ukraine’s largest producer and exporter of sunflower oil. In FY2025, the Group sold 1.4 million tons of vegetable oil (down 5% y-o-y), accounting for 27% of national sunflower oil exports and 10% of global exports. We also sold 1.4 million tons of vegetable meals, representing a 14% y-o-y growth driven by soybean meal. The financial trajectory for the segment re- flects a margin erosion. Excluding contribu- tions from electricity sales, EBITDA margins steadily deteriorated throughout the year, fall- ing from USD 121 per ton in the first quarter to just USD 66 in the fourth, translated into an average margin of USD 94 per ton of oil sold. The intense competition for a scarce supply of seeds continues to suppress profitability, a dy- namic we see no signs of abating. The Infrastructure and Trading segment re- ported EBITDA of USD 218 million in FY2025, a 7% increase y-o-y. This overall result was driven by two sharply contrasting perfor- mances within the division. Our Avere proprietary trading business deliv- ered a strong USD 99 million in EBITDA, a sig- nificant increase from the prior year's USD 53 million. While a positive result, we recognize the inherent volatility of trading income and do not consider this level of performance to be re- curring. In contrast, our Ukrainian grain and vegeta- ble oil export value chain faced considerable pressure from tight domestic fundamentals. EBITDA from these operations declined 21% to USD 119 million. This was caused by a smaller grain harvest of 55 million tons, slow farmer selling, and intensified competition, Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 5 www.ker nel.ua Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 5 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Chairman’s Statement continued which left parts of the logistics system un- derutilized. Within these operations, export terminals were a relatively bright spot, with EBITDA rising to USD 67 million on record transshipment of 9.1 million tons (36% y-o-y). However, handling rates were diluted by sec- tor-wide capacity underutilization. Other sub- lines faced headwinds: grain origination and trading EBITDA declined to USD 39 million on squeezed margins; the railcar business fell to USD 8 million amid an approximately 68% drop in market lease rates; silo services con- tributed USD 4 million as dry-harvest condi- tions reduced demand for drying; and the owned vessel fleet added USD 1 million due to weaker freight and dry-dock off-hire. Our Farming segment reported an EBITDA of USD 184 million, an 8% increase y-o-y, sup- ported by a combination of factors. Strong global grain and oilseed prices provided a sig- nificant tailwind. Additionally, a dry summer re- sulted in low crop moisture, which reduced the need for drying services and contributed to a roughly 13% y-o-y decline in average operat- ing costs per hectare. However, these positive effects were partly offset by adverse weather that reduced corn yields, limiting our total har- vest size and our ability to fully capitalize on the favorable pricing environment. During the year, we sold our entire production along with carry-in stocks from the 2023 harvest, totaling approximately 1.8 million tons. This strategic decision means the Group enters the 2026 fi- nancial year with minimal carry-over inventory for the first time since the onset of the full- scale war. In FY2025, we continued our strategy of de- leveraging the business in response to ongo- ing geopolitical and operational risks. In Octo- ber 2024, we repaid USD 300 million Euro- bond, remaining committed to maintaining our strong credit history. Bond repayment was not an easy task, considering the existing capital controls in Ukraine and the war environment, but our team did its best to reconfirm the posi- tioning of Kernel as the most reliable Ukrainian borrower. During the year, the Group also se- cured the first new international financing since the start of the full-scale war – a one- year USD 150 million sunflower oil pre-export facility from a syndicate of European banks. After passing the peak of working capital needs, the Group fully repaid its outstanding obligations to the EBRD and the sunflower oil PXF in March 2025 and made advance repay- ments on a portion of the amounts due to the EIB. Consequently, the Group’s indebted- ness as of 30 June 2025 reduced by 30% y- o-y, to USD 761 million, and net debt reduced to USD 143 million, down 49% y-o-y. The net- debt-to-EBITDA ratio bottomed at a record over the past decade, 0.3x. Reflecting the ongoing uncertainties of the war in Ukraine and the Group's strategic priority to preserve liquidity, the Board of Directors has recommended that no dividend be paid for the financial year ended 30 June 2025. This approach ensures that capital is retained to support our operational and strategic priorities in a volatile environment. FY2026 outlook Looking into FY2026, Kernel will continue to operate under conditions of high uncertainty, where war-related risks can reshape our oper- ating environment without warning. In such cir- cumstances, flexibility and preparedness re- main central to our approach. We are focused on protecting our people and assets, ensuring business continuity, and restoring operations swiftly whenever disruptions occur. A key pri- ority in this regard for the upcoming year is to make our grain transshipment terminal, which was substantially damaged in 2023, fully func- tional again. This ability to adapt and recover has become one of Kernel’s defining strengths and will guide us through the year ahead. Our most material risks remain unchanged. Agricultural and logistics assets across Ukraine remain vulnerable to attack, and with no insurance coverage for these war-related risks, our exposure is significant. Export per- formance will therefore continue to depend on stable access to the Black Sea, as the capac- ity of alternative routes is not comparable. Alongside these logistical challenges, human capital risk also intensifies with each year of the war through conscription, displacement, and sustained psychological pressure on our workforce. Retaining key talent and supporting our employees remain daily priorities. Beyond these direct operational risks, Ukraine’s agricultural sector continues to op- erate under significant structural pressure. The large carry-over stocks that once cush- ioned the domestic market have been de- pleted, exposing the full impact of reduced acreage. This is compounded by a shift in farmer selling patterns, where many now de- lay sales, tightening near-term supply. At the same time, a recent wave of investment in crushing, rail, and port infrastructure has cre- ated structural overcapacity, compressing margins and intensifying competition for vol- umes. In such an environment, sustainable perfor- mance will demand superior efficiency, disci- plined capital allocation, and an integrated value chain. For Kernel, this means deepening farmer relationships to secure volumes, main- taining asset flexibility, and preserving robust liquidity to withstand operational shocks. We expect the operating environment to remain demanding, defined less by price strength and more by origination access, cost leadership, and execution quality. Building on our existing portfolio of biomass- fueled cogeneration plants, we are exploring opportunities to expand our renewable en- ergy footprint. Our focus is on potential in- vestments in wind, solar, and energy storage, and we have taken initial steps with several pi- lot projects. Our approach remains cautious and exploratory. We are actively monitoring market developments and assessing how var- ious options may align with our long-term strategy. While we see potential for gradual expansion in the coming years, no major in- vestment decisions have been made at this stage. Update on corporate matters The Company is still in the process of delist- ing, initiated in spring 2023, which will be final- ized once approval is obtained from the Polish Financial Supervision Authority. This approval remains pending due to legal challenges filed in Luxembourg by a group of eight minority shareholders, collectively holding 0.4% of Ker- nel’s shares. The same group has also con- tested other corporate decisions, including the share capital increase conducted in August- September 2023 and the resolutions adopted at the Annual General Meeting of Sharehold- ers on 11 December 2023. During FY2025, the Company achieved favor- able outcomes in two proceedings, with Lux- embourg courts declaring the claims inadmis- sible and dismissing them. These rulings reaf- firm Kernel’s firm commitment to sound corpo- rate governance, transparency, and strict compliance with applicable legal frameworks, as well as its focus on long-term value creation for all shareholders. They also underscore the unsubstantiated nature of the claims pursued by this fraction of the minority group. Nonetheless, the claimants have continued to appeal and deliberately delay proceedings, re- peatedly extending deadlines in what the Company regards as obstructive and oppor- tunistic behavior. The Board of Directors con- siders these actions a form of corporate har- assment, aimed not at safeguarding share- holder value but at impeding the Company’s strategic objectives and development for the selfish personal benefit of these shareholders. Confident in the legitimacy and strong ra- tionale behind its decisions, the Company re- mains committed to vigorously defending its position in court. Changes in the Executive Manage- ment Team I would like to announce changes to our Exec- utive Management Team. Mr. Yurii Puhach stepped down as Director of Production Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 6 www.ker nel.ua Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 6 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Chairman’s Statement continued Assets Management, effective 19 August 2025, and Mr. Oleg Tkachenko as Director of Security, effective 26 August 2025. On behalf of the Board, I extend our sincere gratitude to both for their significant contributions during a period of profound operational transformation. I am pleased to confirm they will continue their careers within Kernel in new capacities, ensur- ing we retain their valuable experience. To lead these functions, the Board appointed Mr. Hryhorii Kapustian as the new Director of Production Assets Management and Mr. Ai- biek Toktomushev as Director of Security. Both bring extensive industry knowledge and proven leadership skills that are closely aligned with our strategic priorities. These ap- pointments underscore our commitment to maintaining a capable, forward-looking man- agement team to guide Kernel through a com- plex operating environment. Sustainability progress In FY2025, Kernel strengthened its sustaina- bility framework by aligning its Sustainability disclosure with the EU Corporate Sustainabil- ity Reporting Directive (CSRD) and the Euro- pean Sustainability Reporting Standards (ESRS). During FY2025, we worked exten- sively on shaping Kernel’s ESG Strategy, laying the foundations for a structured and am- bitious approach to sustainability. With this re- port, we are proud to take the next decisive step – committing to forward-looking ESG tar- gets through 2030. By doing so, we position Kernel at the forefront of Ukraine’s agribusi- ness sector as a pioneer of sustainable trans- formation. Our strategy underscores our de- termination to lead by example in addressing global and national challenges, including cli- mate change, biodiversity preservation, and social inequality. Despite the continued challenges posed by the war, Kernel remained committed to sus- tainability and resilience. This year’s efforts in- cluded measurable reductions in greenhouse gas emissions, an increase in the use of re- newable energy, a geospatial analysis of bio- diversity risks, and the screening of plant pro- tection products against the criteria of relevant EU regulations. We also reinforced our social responsibility as an employer and community partner, prioritizing workforce resilience, vet- eran reintegration, and support of local com- munities. Through these efforts, Kernel contin- ues to lead the sustainable and low-carbon development of Ukraine’s agricultural sector. As the war continues, many of our colleagues remain conscripted and are now serving in the Armed Forces of Ukraine. As of the date of this report, 835 Kernel employees are defending our country against Russian aggression. We stand with them and their families, offering ongoing support and contributing to initiatives that strengthen Ukraine’s resilience. Tragically, war has also taken lives. We mourn 62 colleagues who have been killed, and we continue to keep in our thoughts the 44 em- ployees listed as missing. In addition, 151 of our people have sustained injuries while serv- ing or as civilians. Each of these numbers rep- resents a story of sacrifice and suffering, and the Board and management remain commit- ted to ensuring that their dedication is never forgotten. Their memories are honored on a webpage. For those who return from military service, Kernel has developed a support program to help them reintegrate into the workplace and wider community. This includes tailored work- ing conditions, psychological and social sup- port, and training for teams to better under- stand and support colleagues who are veter- ans. As part of these efforts, Kernel adopted the Working with Veterans policy, which guides the integration of demobilized employ- ees into professional and social environments, ensuring they are welcomed back with empa- thy and respect. We also provide care for those who can no longer serve, as well as for the families who continue to carry the burdens of war. As part of our broader effort, Kernel’s social spending amounted to USD 30 million in FY2025, directed to military aid, humanitarian relief for affected communities, and support for our employees and veterans. These initiatives reflect not only our responsibility as an em- ployer but also our role as a corporate citizen, standing firmly with Ukraine in its fight for free- dom and independence. In conclusion, I would like to extend my deep- est gratitude to our employees, whose cour- age and professionalism make our achieve- ments possible, to our partners for their trust, and to our stakeholders for their continued support. Together, we remain committed to delivering long-term value and building a resil- ient future for Kernel. We are equally grateful to the international community for its vital as- sistance to Ukraine in these unprecedented times, and we pay special tribute to the Ukrainian defenders whose bravery safe- guards our country and its people. As we look ahead, Kernel will continue to adapt, invest, and contribute to Ukraine’s recovery and to global food security. Andrii Verevskyi Chairman of the Board of Directors, Founder Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 7 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Our Business Model SBM-1, 42 Oilseed Processing segment • Leading sunflower oil producer (~7 % of global production) and exporter (~10 % of global exports); • Leading bottled sunflower oil producer and marketer in Ukraine; • 4.0 million tons annual sunflower seed pro- cessing capacity; • Producer of renewable energy from bio- mass Infrastructure and Trading segment • Leading grain exporter from Ukraine with 12 % of country’s total grain export in FY2025; • Leading grain export terminal operator with total annual capacity to transship 11 million tons of soft commodities; • #1 private inland grain silo network in Ukraine with 2.2 million tons of one- time grain storage capacity; • #1 private grain railcar fleet in Ukraine (3.4 thousand of accessible own railcars); • Avere proprietary trading activities Farming segment • Leading producer in Ukraine operating 358 thousand hectares of leasehold farmland; • Modern large- scale machinery, sustaina- ble agronomic practices, cluster manage- ment system and export- oriented crop mix; • Nearly 100% of sales volumes flows through our Infrastructure and Trading and Oilseed Processing segments, earning in- cremental profits Own farming 1 Origination and procurement 2 Grain storage 3 Transportation and logistics assets 4 Export terminals 5 Fleet of vessels 6 Oilseed processing 7 Renewable energy 9 Refining and bottling 8 Avere trading operations 10 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 8 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Kernel at Glance …………………………………………………………………………………………………………………………………………………………………………………………………………………………………… . Segment results summary Revenue, USD m EBITDA, USD m Volume, thousand tons 1 EBITDA margin, USD/t 2 FY2024 FY2025 y-o-y FY2024 FY2025 y-o-y FY2024 FY2025 y-o-y FY2024 FY2025 y-o-y Oilseeds processing 1,864 2,107 13% 83 148 77% 1,477 1,407 (5%) 56 105 86% Infrastructure & trading 2,011 2,169 8% 204 218 7% 5,452 5,427 (0%) 37 40 8% Farming 481 468 (3%) 171 184 8% 1,813 1,658 (9%) 476 515 8% Unallocated corporate expenses (77) (84) 9% Reconciliation (775) (629) (19%) Total 3,581 4,115 15% 381 466 22% Note 1 : Physical grain volumes exported from Ukraine (ex. Avere) for Infrastructure and Trading; harvest of grain and oilseeds in the Farming segment. Note 2 : USD per ton of vegetable oil sold for Oilseed Processing; USD per ton of grain exported (ex. Avere volumes) for Infrastructure and Trading; USD per hectare for Farming. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 9 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Financial Performance in FY2024 FY2025 marked the first full year of relative opera- tional stability since the onset of the full-scale war in Ukraine in February 2022. While uncertainty re- mained elevated, uninterrupted export operations via the Black Sea ports enabled the Group to fully lever- age its integrated value chain, with 8 million tons of agricultural goods sold (flat y-o-y). The Group’s EBITDA amounted to USD 466 million, representing a 16% y-o-y decline when compared to the FY2024 result adjusted for one-off impairments and other nonrecurring items, given the highly chal- lenging operating environment: • Oilseed Processing delivered USD 148 million in EBITDA, down 34% y-o-y. Limited sunflower seed supply shifted bargaining power from crushers to farmers, constraining margins throughout the year and resulting in USD 105 EBITDA per ton of oil sold. Nevertheless, diversification into soybeans and rapeseed allowed the Group to sustain high utilization rates. • Infrastructure and Trading generated USD 218 million EBITDA (up 7% y-o-y), supported by record 9.1 million tons of transshipment volumes and an exceptional USD 99 million of Avere’s contribution, partially offset by narrowed trading margins and weaker contributions from railcar and silo services. • Farming achieved USD 184 million in EBITDA (up 8% y-o-y), supported by higher crop prices and re- duced per-hectare costs, partially offsetting drought-affected yields. • Unallocated corporate expenses increased by 9% y-o-y to USD 84 million. Net profit attributable to the shareholders of Ker- nel Holding S.A. soared by 42% y-o-y to USD 238 million. Kernel also materially improved its debt profile. A key milestone was the full repayment of USD 300 mil- lion Eurobonds maturing in October 2024. To- gether with broader deleveraging and disciplined cash flow management, this reduced total debt by 30% to USD 761 million and net debt by 49% to USD 143 million. With USD 618 million in cash at year- end, the Group entered FY2026 with a strengthened balance sheet, robust liquidity, and enhanced finan- cial flexibility. Our outlook for FY2026 remains cautious, reflecting both opportunities and risks. Stable Black Sea export operations are expected to continue supporting sales volumes and infrastructure utilization, while a pro- jected recovery in Ukraine’s harvest size is likely to be modest and uneven, offering only partial relief to supply constraints across the core business lines. However, geopolitical risks remain elevated, with on- going hostilities and the persistent threat of disrup- tions to export logistics. Against this backdrop, Ker- nel will maintain a disciplined approach to financial and operational management, prioritizing resilience, cost efficiency, and prudent capital allocation, while safeguarding liquidity and reinforcing the Group’s ability to adapt to rapidly changing market conditions. Revenue USD 4,115 million +15% y-o-y EBITDA USD 466 million +22% y-o-y FINANCIAL PERFORMANCE Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 10 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Financial Performance in FY2025 continued Income statement highlights The Group’s revenue grew by 15% y-o-y, ex- ceeding USD 4.1 billion in FY2025. The in- crease was primarily driven by higher global grain and edible oil prices, while physical sales volumes remained broadly unchanged. Reve- nue from freight and other services declined by 35% y-o-y to USD 265 million, reflecting the higher share of sales executed under FOB In- coterms. Export sales continued to dominate, accounting for 95% of total revenue. In FY2025, we recognized a USD 7 million gain from the net change in fair value of bi- ological assets and agricultural produce, compared to a USD 10 million loss recorded a year ago. This reflects gains from revaluing crops in the fields to fair value less costs to sell as of 30 June 2025, and expensing of similar gains recorded in the previous year, as well as losses from changes in the fair value of live- stock, as required by IAS 41. Cost of sales rose by 23% y-o-y to USD 3,553 million, largely due to a 45% y-o-y rise in costs of goods available for sale and raw materials, reflecting heightened competition for feedstock and constraints in grain supply. In contrast, shipping and handling expenses plummeted by 44% y-o-y, supported by lower freight rates. Payroll and payroll-related ex- penses increased by 13% y-o-y, reaching USD 91 million. Driven by the surge in the cost of sales, which outpaced revenue growth, the gross profit for the reporting period diminished by 17% y-o-y, totaling USD 568 million. Other operating income totaled USD 68 mil- lion, down 11% y-o-y. Unlike the prior year, which included a one-off insurance reimbursement of USD 34 million for property damage and business interruption, this year’s result was mainly composed of USD 26 million gains on securities related to liquidity manage- ment, USD 15 million gains from contract wash-outs, USD 10 million income from stock- takes, and other minor items. Other operating expenses rose 1.6x y-o-y to USD 46 million, mainly reflecting losses from derivative operations and currency swaps, partly offset at the other operating income level by higher gains on securities and im- proved yields on interest-bearing instruments. General, administrative and selling ex- penses in FY2025 expanded by 10% y-o-y, to USD 235 million, mainly on the back of higher payroll and payroll-related costs. In FY2025, the Group recognized a USD 9 mil- lion reversal of impairment losses following asset revaluation, compared with a USD 229 million impairment loss recorded a year ago, which had been driven by the anticipated de- terioration in the business outlook, growing competition in Ukraine, and increasing future risks for the business. Consequently, operating profit in FY2025 surged by 31% y-o-y, to USD 361 million. Finance costs in FY2025 declined by 35% y- o-y, coming to USD 78 million, reflecting the redemption of USD 300 million of Eurobonds maturing in October 2024 and the Group’s broader deleveraging efforts. Meanwhile, fi- nance income in the reporting period con- tracted by 9% y-o-y, settling at USD 45 million, primarily comprising interest earned on finan- cial assets held for cash management, as ex- tra liquidity balances were allocated into interest-bearing instruments. Consequently, net finance costs more than halved y-o-y, settling at USD 32 million. The Group recognized a net foreign ex- change loss of USD 5 million for the year ended 30 June 2025, primarily driven by the revaluation of balances denominated in Ukrainian hryvnia (UAH). Other expenses, net, increased 25% y-o-y to USD 36 million, reflecting higher charity and social spending as well as support of Ukrain- ian defenders of USD 30 million (up 21% y-o- y) and a USD 5 million loss on the disposal of a subsidiary. With a profit before income tax of USD 287 million, the Group recognized corporate in- come tax expenses of USD 50 million in FY2025, resulting in a net profit of USD 238 million attributable to the shareholders of Kernel Holding S.A. After accounting for ex- change differences in translating foreign oper- ations (a loss of USD 26 million) and other items, the total comprehensive income at- tributable to equity holders of the Company amounted to USD 220 million in FY2025, up 3.5x y-o-y. Considering the significant uncertainties and risks related to the Group’s future perfor- mance, the Board of Directors recommended that the general meeting of shareholders de- clare a dividend of nil for the year ended on 30 June 2025. Cash flow highlights The Group generated USD 434 million in op- erating profit before working capital changes, down 28% y-o-y, in line with the EBITDA pattern, considering the prior-year one-off non-cash impairment that distorted ……………………………………………………………………… Kernel’s EBITDA split by segments USD million (65) (166) (101) (77) (84) 461 219 221 171 184 359 237 154 204 218 51 (70) 270 83 148 806 220 544 381 466 FY2021 FY2022 FY2023 FY2024 FY2025 Oilseed Processing Infrastructure and Trading Farming Unallocated corporate expenses Total EBITDA ………………………………………………………………………………………………………………………………………................... Income statement highlights USD million FY2024 FY2025 y-o-y Revenue 3,581 4,115 15% Net IAS 41 gain (10) 7 n/a Cost of sales (2,889) (3,553) 23% Gross profit 682 568 (17%) Other operating income 77 68 (11%) Other operating expenses (28) (46) 1.6x Net impairment losses on financial assets (11) (2) (78%) Loss on impairment of assets (229) 9 n/a General, administrative and selling expenses (213) (235) 10% Operating profit 276 361 31% Finance costs, net (69) (32) (53%) Foreign exchange gain, net 33 (5) n/a Other (expenses), net (29) (36) 25% Profit before income tax 211 287 36% Income tax (expenses) / benefit (43) (50) 14% Profit for the period 168 238 42% Attributable to equity holders of Kernel Holding S.A. 168 238 42% Non-controlling interest (0.3) (0.6) 74% EBITDA 381 466 22% Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 11 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Financial Performance in FY2025 continued EBITDA in FY2024. The Group's working capital changes re- sulted in a cash outflow of 103 million in FY2025, as compared to a USD 21 million cash outflow in FY2024. The outflow primarily reflected the accumulation of oilseed pro- cessing products, such as edible oils and veg- etable meals, at year-end, coupled with the higher valuation of such inventories. Interest paid in FY2025 totaled USD 78 mil- lion, down 29% y-o-y, while interest received remained broadly flat y-o-y at USD 32 million. After accounting for USD 44 million in income tax paid, the Group generated USD 242 mil- lion in cash from operating activities, down 49% y-o-y. Net cash used in investing activities totaled USD 40 million in FY2025, primarily compris- ing USD 73 million expenditures on the prop- erty, plant, and equipment related to the re- placement of out-of-date agricultural machin- ery, reconstruction of the damaged terminal in Chornomorsk, and other maintenance activi- ties, and USD 12 million outflow from the pur- chase of intangible and other non-current as- sets. These expenditures were partially offset by USD 43 million of inflows from the disposal of financial assets previously allocated for li- quidity management. Within the financing activities, the Group re- paid USD 300 million of Eurobonds maturing in 2024 and USD 223 million of bank borrow- ings, while securing USD 150 million from new borrowings and USD 14 million in net pro- ceeds from credit lines, primarily with Ukrain- ian banks. In addition, USD 34 million was used to repay farmland lease liabilities. As a result, the total cash outflow during the reporting period reached USD 192 million, compared with a USD 145 million cash outflow a year earlier. Therefore, the Group’s cash po- sition as of 30 June 2025 settled at USD 618 million, down 24% y-o-y. Debt overview Despite operating under wartime conditions, a disciplined approach to debt management al- lowed the Group to reduce total debt liabilities by 30% y-o-y: • The Group successfully repaid USD 300 million of the Eurobond maturing on 17 October 2024, along with the respective coupon. Initially, the Group faced difficulties accumulating the required amount in ac- counts outside Ukraine due to capital and currency controls imposed by the National Bank of Ukraine (“NBU”). However, some of the easing of currency restrictions imple- mented by the NBU allowed the Group to accumulate the necessary liquidity and complete the Eurobond repayment, demon- strating its commitment to meeting financial obligations. • Additionally, on 23 October 2024, a USD 150 million sunflower oil pre-export fi- nancing facility became effective to sup- port the Group's export operations and meet working capital needs for the upcom- ing financial year. This financing was se- cured from a syndicate of European banks and international financial institutions. The facility was scheduled to mature in August 2025, with an option for extension. It was the first new financing provided by interna- tional lenders to Kernel since the onset of the full-scale war in Ukraine. • After passing the seasonal peak of working capital financing, the Group fully repaid its obligations to the EBRD and the sunflower oil PXF in March 2025 and made advance repayments on a portion of the amounts due to the EIB. Therefore, at year-end, the Group's total debt outstanding amounted to USD 761 million, comprising: • USD 298 million book value of Eurobonds maturing in October 2027 (USD 300 million principal); • USD 205 million in lease liabilities arising from farmland lease agreements entered into by the Group; • USD 175 million in short-term debt (includ- ing USD 147 million owed to Ukrainian and international banks, USD 22 million on the current portion of long-term debt owed to the EIB and Ukrainian bank, and USD 6 mil- lion in accrued interest on bonds and bank loans); • USD 82 million in long-term debt (including USD 70 million owed to the EIB and USD 12 million owed to the Ukrainian bank). Dur- ing the year, the Group successfully se- cured an extended waiver from one of its long-term lenders, effective until 30 June 2026. This has enabled the Group to reclas- sify its bank borrowings with an initial long- term contractual maturity as non-current li- abilities, reflecting improved financial stabil- ity and visibility. The Group’s cash position totaled USD 618 million at the year-end, down 24% y-o-y. Ac- cordingly, the Group’s net debt reduced by ……………………………………………………………………………………………………………………………………….................. Liquidity positions and credit metrics USD million, except for ratios 30 June 2024 30 June 2025 y-o-y Short-term interest-bearing debt 323 175 (46%) Long-term interest-bearing debt - 82 n/a Lease liabilities 170 205 21% Eurobonds 598 298 (50%) Debt liabilities 1,090 761 (30%) Cash and cash equivalents 810 618 (24%) Net debt 281 143 (49%) Commodity inventories 247 299 21% of which edible oil and meal 94 208 2.2x Sunflower seeds 85 46 (46%) Grains and other commodity inventories 68 44 (35%) Adjusted net debt 34 (155) n/a Shareholders’ equity 1,865 2,078 11% Net debt / EBITDA 0.7x 0.3x (0.4x) Adjusted net debt / EBITDA 0.1x (0.3x) (0.4x) EBITDA / Interest 5.5x 14.4x 8.9x …………………………………………………………………….. Kernel 2027 Eurobonds mid -YTM Source: Bloomberg - 10% 20% 30% 40% 50% Jul 22 Jan 23 Jul 23 Jan 24 Jul 24 Jan 25 Jul 25 …………………………………………………………………….. Working capital and debt position USD billion “Working Capital”, “Net Debt” and “Commodity in- ventories” definitions as described in section Alterna- tive Performance Measures . 0.0 0.5 1.0 1.5 2.0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY2021 FY2022 FY2023 FY2024 FY2025 Working Capital Net Debt Commodity inventories Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 12 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Financial Performance in FY2025 continued 49% y-o-y during FY2025, standing at USD 143 million as of 30 June 2025. The commodity inventories balance as of 30 June 2025 totaled USD 299 million, up 21% y- o-y, exceeding the net debt by USD 155 mil- lion. Inventories related to oilseed processing (sunflower seeds, edible oils, and meals) rose 1.4x y-o-y to USD 254 million, while grain in- ventories contracted by 35% to USD 44 mil- lion: • Volume-wise, as of 30 June 2025, Kernel had in stock 175 thousand tons of edible oil, 58 thousand tons of sunflower meal, 85 thousand tons of sunflower seeds, and 209 thousand tons of grains (primarily corn and wheat); • Noticeably, inventory value increased sig- nificantly, with sunflower seed costs per ton up 28% y-o-y and grain inventory costs up 27% y-o-y, reflecting tighter feedstock avail- ability amid a smaller national harvest of both grains and oilseeds. Consequently, commodity inventories sur- passed net debt by USD 155 million, resulting in a negative adjusted net debt of USD 155 million as of 30 June 2025. Over FY2025, the key leverage metrics im- proved to 0.3x Net debt / EBITDA and 14.4x EBITDA / Interest as of 30 June 2025. In December 2024, S&P upgraded Kernel’s rating to “CCC”. Additionally, in May 2025, Fitch affirmed Kernel’s credit rating at CCC-. Undrawn facilities as of 30 June 2025 amounted to USD 313 million, primarily com- prising short-term credit lines in Ukraine and Avere’s financing. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 13 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Oilseed Processing The operating environment for the Oilseed Pro- cessing segment in FY2025 was defined by a pro- nounced imbalance between supply and capacity. Global sunflower oil prices remained firm throughout the year, supported by constrained global supply and weather-driven disruptions in key producing regions. Domestically, however, the Ukrainian processing industry faced growing pressure as crushing ca- pacity expanded to 20.3 million tons while the sun- flower seed harvest declined to 11.8 million tons. This widened the supply-capacity gap to a new high of 8.5 million tons, intensifying competition for feed- stock and compressing margins. During the year, the Group achieved a significant milestone by processing three crops – sunflower, soybeans, and rapeseeds – for the first time. Total processing volumes reached 3.5 million tons, up 8% y-o-y, supported by the full year operation at the new oilseed processing plant in western Ukraine. Ex- panding beyond sunflower enabled the Group to maintain a high utilization rate of 87% across its crushing plants, despite temporary shutdowns at several facilities caused by limited sunflower seed availability. Edible oil sales totaled 1,407 thousand tons, down 5% y-o-y. This volume also includes 82 thousand tons of bottled oil, which remained flat y-o-y, and 67 thousand tons of edible oils procured on a CPT basis and resold. Segment EBITDA rose to USD 148 million in FY2025, up 77% y-o-y from USD 83 million recorded in the previous year, although the prior-year result was adversely affected by one-off USD 167 million impairment loss. FY2026 outlook The structural imbalance between sunflower seed supply and crushing capacity is expected to persist. The sunflower seed harvest is projected at only 11.4 million tons, broadly flat y-o-y, while total crushing capacities are anticipated to expand further to 21 mil- lion tons. The recently introduced 10% export duties on soy- beans and rapeseed are intended to channel raw materials into domestic processing, reduce shadow exports, and boost higher value-added exports. While this measure should improve overall industry utilization, its direct effect on Kernel is expected to remain limited, given the Group’s already high utili- zation rate. Looking ahead, Kernel will focus on enhancing oper- ational efficiency in soybean and rapeseed pro- cessing, which remain relatively new crops for its portfolio and offer considerable potential for further processes and costs optimization. 3.5 million tons of oilseeds processed EBITDA (before unallocated head office expenses) USD 148 million +77% y-o-y Revenue USD 2,107 million +13% y-o-y OILSEED PROCESSING Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 14 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Oilseed Processing continued Market overview While remaining mindful of the ongoing war and associated risks that may impact opera- tions, we identify two key factors materially af- fecting Kernel’s oilseed processing business: 1) the oilseeds supply-demand balance in Ukraine, with sunflower remaining the princi- pal crop and the main driver of processing vol- umes, determining the profit distribution be- tween farmers and crushers; and 2) the global vegetable oil prices, which influence the combined earnings of domestic oilseed farming and processing. Oilseed supply Ukraine's sunflower seed processing industry is predominantly localized, with the majority of seeds harvested by domestic farmers and pro- cessed within the country. Typically, import and export volumes of sunflower seeds are minimal, resulting in negligible carry-over stocks across seasons. In FY2025, a reduc- tion in both harvested area and yield led to a 2.8 million tons decrease in the sunflower seed harvest as compared to the previous year, which totaled 11.8 million tons for the year. With rapeseeds and soybeans added, the total oilseeds harvest in Ukraine in FY2025 resulted in 22.4 million tons, down 9% y-o-y. With sufficient storage capacity and comforta- ble liquidity levels, farmers refrained from sell- ing oilseeds immediately after harvest, opting instead to delay sales in anticipation of higher prices. This disrupted the usual processing patterns, as a significant portion of oilseeds only reached the market in March-April. Demand for oilseeds At the same time, sunflower seed pro- cessing capacity in Ukraine increased by 9% y-o-y, to 20.3 1 million tons driven by the com- missioning of our state-of-the-art plant in west- ern Ukraine and two other small local plants. This widened the gap between crushing ca- pacity and sunflower seed supply to a new high of 8.5 million tons, creating a tight supply- demand environment that pressured crushing margins and limited plant utilization through- out the season. Taking into account all availa- ble oilseed processing facilities (incl. those for soybeans and rapeseeds), Ukraine’s total ca- pacity in FY2025 exceeded 22 million tons of oilseeds. Global sunflower oil export and prices Sunflower oil is the fourth-largest consumed vegetable oil in the world, with an 8.5% mar- ket share in the 2024/25 season. The largest 1 Source: Kernel’s estimate, not including the plants on the occupied territories or those with suspended operations for the whole or part of the season due to the proximity of the frontline. 2 Source: USDA. 3 Source: Kernel’s estimate. consumers and importers are India, the EU, Turkey, Iran, China, Iraq, and Egypt, collec- tively accounting for 77% of the global imports. Meanwhile, Ukraine stands as the largest global exporter, contributing 37% to the total exports 2 . Throughout the 2024/25 season, Ukraine’s sunflower oil export decreased by 25%, reach- ing 4.7 million tons. Kernel accounted for ~27% of Ukraine’s sunflower oil export 3 . Prices of major vegetable oils are highly cor- related due to their substitutability and shared demand drivers, particularly the food industry and biofuel production. Palm and soybean oils, as the most liquid markets, serve as the primary benchmarks for global price trends. Nonetheless, regulatory shifts or changes in demand patterns may cause temporary devia- tions. For Kernel, which focuses primarily on sunflower oil, it is noteworthy that sunflower oil proved the most resilient among the oils over the past twelve months, despite considerable volatility: • Sunflower oil prices opened the 2024/25 marketing year above USD 1,000 per ton and rose by more than USD 200 per ton by November, driven by tight global supply conditions resulting from adverse weather in key producing regions. Although the mar- ket experienced a modest correction during winter, prices maintained a robust level throughout spring and summer; • Palm oil dominated the broader market nar- rative. Supply shortages in Indonesia and Malaysia, combined with stronger domestic demand from biodiesel mandates, restricted export availability and fueled a sharp early- season rally. A correction followed as buy- ers shifted to cheaper alternatives, particu- larly soybean oil. Still, palm oil occasionally maintained a premium, supported by sea- sonal dips in output and a weaker Malay- sian ringgit. Prices later moved into discount territory in spring and early summer but be- gan recovering toward the close of the sea- son, once again supporting the broader vegetable oil complex; • Soybean oil also emerged as a key market trend throughout the year. While it remained the most competitively priced option amid ample global supply for much of the period, sustained demand from the biodiesel and renewable diesel sectors in the United States and Brazil helped sustain price lev- els. Later in the season, soybean oil experi- enced a sharp rally driven by expectations of increased U.S. blending mandates, re- strictions on imported feedstocks, and new tax incentives designed to promote domestic biofuel production – all of which contributed to a more optimistic outlook for U.S. consumption. As we move into the new season, sunflower oil remains well-supported, while broader mar- ket dynamics continue to reflect the balance between biodiesel policy, crop outcomes, and shifting trade flows. …………………………………………………………………… Major vegoils prices USD per ton of oil sold in bulk Source: Kernel 600 800 1,000 1,200 1,400 1,600 1,800 2,000 Soybean oil CNF India Sunflower oil CIF India Crude palm oil Bursa Malaysia Derivatives Rapeseed oil FOB Rotterdam FY2025 FY2023 FY2024 …………………………………………………………………………………… Sunflower p rocessing capacities in FY2025 million tons Source: Kernel’s estimates 23% 19% 13% 7% 38% 20.3 Local small Local big Kernel MHP Multinationals Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 15 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Oilseed Processing continued SBM-1 Our business model Market leader in oilseed processing Kernel is the leading global producer and ex- porter of sunflower oil. In FY2025, we ac- counted for ~7% of global sunflower oil pro- duction and ~10% of global sunflower oil export 1 . Asset base Kernel owns seven oilseed processing plants across various regions in Ukraine 2 , with the combined sunflower seed processing ca- pacity of 4 million tons in FY2025 (19% of Ukraine’s total 3 ). Four of the Group's crush- ing facilities are multi-seed, enabling the processing of soybeans or rapeseed as needed. These assets operate year-round, with maintenance typically scheduled for one month during the summer. At our plants, we have constructed six cogen- eration heat and power facilities (CHPs) that utilize sunflower husk (biomass) to gener- ate electricity for sale to the national grid or for our own production needs, with a combined capacity of 84.4 MW. These CHPs also enable us to power our crushing operations and achieve energy self-sufficiency during power outages in Ukraine. The oilseed processing plant in Poltava is equipped with refinery, bottling, and pack- aging lines, featuring a maximum annual re- fining capacity of 131.4 thousand tons of oil. 1 Source: USDA, Kernel analysis. 2 Two of Kernel’s oilseed processing plants, occupied by Russia at the onset of the war in February 2022, sustained severe damage due to the Russian offensive in the Kharkiv region toward the end of FY2024. The restoration of processing capacities is not considered feasible in the foreseeable future. Both assets were fully impaired back in FY2022. 3 Source: Kernel’s estimates. The majority of refined oil is bottled and sold through retail channels, while the remainder is distributed in bulk on the domestic market and exported by rail. The Group’s crushing facilities are state-of- the-art and regularly upgraded, ensuring a competitive processing cost advantage over many industry participants. Energy self-suffi- ciency further enhances operational resili- ence, particularly within the current Ukrainian market landscape. The scale of Kernel’s oper- ations allows for optimal utilization of the na- tionwide origination network and facilitates more efficient allocation of overhead costs across higher volumes. All assets are strategically located within Ukraine’s sunflower seed production belt, in close proximity to farmers. This supports crush capacities utilization rates and profitabil- ity, as the low density of sunflower seed neg- atively impacts the economics of long-dis- tance seed transportation. Origination and production The Group heavily relies on procuring sun- flower seeds from external farmers, as the Group’s Farming segment secured only 11% of oilseeds processed during FY2025. The processing of sunflower seeds primarily results in two key products: sunflower oil and meal. A detailed visualization of the crushing process is provided below. These products are predominantly exported to international …………………………………………………………………………………… Edible oil sold in bulk destinations FY202 5 thousand tons …………………………………………………………………………………… Kernel oilseed processing volumes thousand tons 46% 31% 11% 6% 6% Europe India Iraq Turkey Other 1,326 663 482 490 610 684 1,001 985 687 811 973 902 563 745 816 845 617 157 655 954 952 3,183 2,187 2,577 3,192 3,453 FY2021 FY2022 FY2023 FY2024 FY2025 Q1 (ends 30 Sep) Q2 (ends 31 Dec) Q3 (ends 31 Mar) Q4 (ends 30 Jun) ………………………………………………………………………..…..…..…..…..…..…..…..…..…..…..…..…..…..…..…..…..…..…..…..…..…..…..…..…..………………………………………………………………………..…..…..…..…..…..…..…..…..…..…… Sunflower seed crushing process p roduct yields based on the five-year average Refining & bottling Dehulling & filtering Burning… Sunflower seeds (1,000 kg) Dehulled kernel Pressing & extracting An edible oil rich with Omega -3 and Omega- 6 acids. A traditional vegetable oil of choice for many regions of the world, sunflower oil is used only for culinary pur- pose, primarily for salad dressing and frying. A protein - rich livestock feed, used for compound feed production for hog, cattle , and poultry industries across the world. It is the t hird most important meal globally after soybean and rapeseed. Electricity is sold to the national grid as renewable en- ergy . A biomass is used to produce steam and energy on our plants but can also be pelletized and sold to third par- ties. Crude sunflower oil (45%) Bottled sunflower oil Husk (1 7%) … or selling Electricity for sale (up to 180 kWh) Sunflower Meal (38%) Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 16 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Oilseed Processing continued markets via maritime shipping through the Group’s transshipment terminals. Additionally, the sunflower seed husk, a bio- mass by-product of the crushing process, is mainly utilized on-site as fuel to generate steam for production needs and electricity for both internal consumption and sale to the na- tional grid. For other oilseeds, product yields vary: soy- bean processing results in approximately 20% oil and 73% meal, while rapeseed processing yields about 44% oil and 54% meal. Sales Vegetable oil in bulk Oilseed processing is primarily export-ori- ented, with over 90% of the produced sun- flower oil exported in bulk to key markets such as India, Europe, the UAE, Turkey, and Iraq. In FY2025, 72% of bulk oils sales were on CIF/CFR terms, while FOB sales accounted for 11% of the Group’s export volume. Almost 75% of the bulk vegetable oil sales were exported through our vegetable oil deep- water transshipment terminal in Chornomorsk, acquired in July 2023. The remaining volumes were primarily transported by inland rail. While the Group primarily relies on chartered vessels, during the reporting period our own tanker “Mavka” transported 84 thousand tons of vegetable oil to destinations including the Netherlands, Portugal, and Italy. Kernel’s primary customers include soft com- modity processors involved in refining and bot- tling sunflower oil, international trading com- panies, as well as buyers who use our oil as feedstock for biofuel production. The largest customer in FY2025 was Viterra B.V., contrib- uting 11% of total bulk oil sales. The Group continued procuring edible oils in Ukraine on a CPT basis, subsequently export- ing them on CIF/CFR terms to capitalize on additional trading margins. This year, we dou- bled the volume of sunflower oil purchased to 57 thousand tons, while rapeseed oil pur- chases totaled 10 thousand tons. Vegetable meals Vegetable meals are also a fully export-ori- ented product, with the majority of volumes shipped through the Group’s terminal in Chor- nomorsk, supplemented by exports via inland logistics routes. Bottled sunflower oil In FY2025, 120 thousand tons of crude sun- flower oil were further refined, with 70% (84 thousand tons) of this refined volume bottled at our Poltava plant, generating additional margin from this higher value-added product. The remaining refined oil was sold in bulk. In FY2025, 66% of bottled sunflower oil pro- duction was exported to Europe, the Middle East, Asia, and Africa under Kernel brands and private labels. Kernel held a 20% share of Ukraine's total refined bottled sunflower oil ex- ports, supplying international retailers like Walmart and Maxima. The remaining 34% of bottled oil was sold do- mestically through 19 nationwide retailers, 25 regional distributors, and 34 other customers, including charitable foundations, government institutions, and local customers. Domestic sales were split 75% to retailers and 25% to distributors under brands like “Schedryi Dar”, “Stozhar”, and “Chumak”. Renewable energy All renewable energy produced by Kernel’s CHPs was previously sold under long-term power purchase agreements to the state- owned enterprise “Guaranteed Buyer”. These agreements fixed the feed-in tariff at 0.12 EUR/kWh until 2030. However, starting Sep- tember 2024, we shifted to selling electricity on the open market. This strategic change was driven by the energy deficit in Ukraine, prompted by Russian attacks on the country’s energy infrastructure, which has caused day- ahead market prices to rise, making the terms with “Guaranteed Buyer” less economically advantageous. Contractual commitments As of 30 June 2025, the Group had contrac- tual commitments to sell 270 thousand tons of edible oil for USD 291 million (USD 1,076 per ton) and 98 thousand tons of sunflower meal for USD 29 million (USD 290 per ton). Key developments Non-core oilseeds processing Constraints in sunflower seed availability, cou- pled with continuously expanding processing capacities, created new challenges for market participants in FY2025. The widening gap be- tween seed supply and crushing demand, which reached 8.5 million tons during the year, prompted the Group to diversify its processing portfolio beyond sunflower seeds into other oilseeds, including soybeans and rapeseed. While rapeseed had already been part of Ker- nel’s processing mix, FY2025 marked the Group’s first large-scale experience with soy- beans. Over the reporting period, Kernel’s plants pro- cessed 314 thousand tons of soybeans and 138 thousand tons of rapeseed. This posi- tioned the Group as one of Ukraine’s largest soybean processors, with the majority of vol- umes handled at the state-of-the-art facility commissioned in February 2024. Diversifying into multiple oilseeds was not without chal- lenges, yet the Group successfully adapted and sustained high efficiency levels across its crushing plants. This resilience enabled Ker- nel to mitigate the impact of constrained sun- flower seed supply while laying a strong foun- dation for future growth in alternative oilseed processing. Renewable energy In October 2024, the Group commissioned its final 20 MW CHP unit, increasing total in- stalled capacity to 84.4 MW. As a result, in FY2025, Kernel sold to the grid or substi- tuted purchased electricity totaling 380 GWh, compared with 369 GWh in FY2024. Generation volumes fell short of expectations, …………………………………………………………………………………… Bottled sunflower oil destinations FY2025 million liters 42% 34% 11% 3% 4% 6% Europe Ukraine Middle East Africa Asia Other 89 …………………………………………………………………………………… Kernel bottled oil core brands …………………………………………………………………………………… Kernel bottled oil selected customer s Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 17 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Oilseed Processing continued primarily due to limited sunflower seed availa- bility, which reduced the supply of husk used for power production. In addition, the actual husk yield was lower than forecast, further constraining output. Currently, we are explor- ing options to use biomass other than husk in our co-generation heat and power plants to di- versify the fuel base, enhance operational re- silience, and reduce dependence on sun- flower seed harvest dynamics. The Group secured USD 328 thousand in co- financing from the Jumbo Impact Fund for the substation reconstruction project at the Pol- tava oilseed extraction plant. The investment supported a low-carbon production initiative that enabled the refinery at the Poltava oilseed extraction plant to operate entirely on renewa- ble energy generated from sunflower husks. Consequently, the plant was officially certified as a renewable energy consumer by Bureau Veritas Group. Bottled oil Over the course of the year, we placed strong emphasis on expanding and improving sales within the Food Service segment. Our efforts focused on strengthening relationships with key partners in the hospitality, catering, and in- stitutional sectors, as well as enhancing our product offering and service quality to better meet the needs of professional kitchens. This year, we also introduced our new bag-in- box (BIB) packaging format for the first time – a durable, multi-layer pouch encased in a rigid cardboard box. This packaging was certified under the BRCGS Global Food Safety Stand- ard, ensuring high product quality and safety. War impact The ongoing war in Ukraine continues to im- pact our operational performance across mul- tiple areas: 1 Includes 272 thousand tons of oilseeds processed by Kernel plants in FY2025 via tolling agreements. • Asset damage: in early August 2024, our largest oilseed processing facility in western Ukraine was damaged by a Russian drone attack, leading to a temporary shutdown of the operations. The repair costs amounted to USD 206 thousand, with operations suc- cessfully resumed in September 2024 fol- lowing a month of pre-season maintenance and repairs. • Conscription of employees: employee conscription into the Ukrainian military re- sulted in notable labor shortages at our crushing facilities, complicating recruitment and retention of qualified personnel, partic- ularly in high-risk regions. The frequency of personnel turnover has disrupted opera- tional continuity and exerted additional strain on remaining staff, thereby affecting overall productivity and efficiency. Headcount In FY2025, the headcount in the Oilseed Processing segment decreased by 12% y-o- y, to 2,193 employees, as we eventually had to lay off staff from our destroyed plants in the Kharkiv region who could not be transferred to other facilities. Performance overview Over FY2025, Kernel processed 3.5 million tons of oilseeds 1 , representing an 8% y-o-y increase, despite the supply-demand con- straints that affected seasonal processing pat- terns. There are two key drivers behind the in- crease in processing volumes: • the commissioning of the state-of-the-art oilseed extraction plant in western Ukraine in February 2024, which was operational for the whole FY2025, adding the annual sun- flower seed processing capacity of 1 million tons. • the Group’s ability to adapt its processing mix to include alternative oilseeds, mitigat- ing the impact of limited domestic sunflower seed availability during the year. Of the total oilseeds processed, soybeans accounted for 314 thousand tons, while rapeseeds comprised 138 thousand tons. This flexibil- ity helped achieve a combined utilization rate of 87% across the Group’s oilseed ex- traction plants, compared with 75% if based solely on sunflower seed processing. With a total of 3 million tons of sunflower seeds processed, Kernel’s market share in Ukraine’s sunflower seed processing is es- timated at 26% for FY2025, the highest level in the Group’s history and an increase of 5pp compared to FY2024. This record perfor- mance reflects not only the strong operational efficiency of our crushing assets but also the solid relationships built with farmers and the effective work of our procurement team in se- curing raw material supply. While processing volumes increased com- pared to the previous year, edible oil sales declined by 5% y-o-y to 1,407 thousand tons in FY2025, primarily due to variations in oil content across the oilseeds processed (as de- scribed in the Origination and production sec- tion above). The total sales volume included 82 thousand tons of bottled sunflower oil (down 2% y-o-y) and 67 thousand tons of edi- ble oils purchased on a CPT basis in Ukraine for trading purposes and subsequently ex- ported. During the reporting period, the Group also sold 1,421 thousand tons of vegetable meals – another key product generated from the oilseeds processing operations. Sunflower meal accounted for 80% of the total, with soy- bean meal and rapeseed meal making up the remainder. Although vegetable meals have lower value compared to the oil itself, their sales are strategically vital for optimizing over- all crushing margins and mitigating inventory buildup that could potentially disrupt plant op- erations. Ensuring efficient sales channels is imperative given the limited shelf life of vege- table meals, thereby supporting operational continuity and profitability. The Oilseed Processing segment generated USD 148 million EBITDA in FY2025, up 77% y-o-y from USD 83 million in FY2024. The prior-year result, however, included a one-off impairment loss of USD 167 million and a USD 27 million gain from insurance payments for property damage and business interruption due to the Russian invasion of Ukraine. Ad- justing for these one-offs, EBITDA in FY2025 reduced by 34% y-o-y. Despite a decline in edible oil sales volumes, overall processing output remained broadly …………………………………………………………………………………………………………………………………………………… Oilseed Processing segment performance FY2024 FY2025 y-o-y Oilseeds processed thousand tons 3,192 3,453 8% Edible oil sales thousand tons 1,477 1,407 (5%) Revenue USD million 1,864 2,107 13% EBITDA USD million 83 148 77% EBITDA per ton of oil sold USD / ton 56 105 86% EBITDA margin % of revenue 4.5% 7.0% 57% …………………………………………………………………………………… Meal sales by type of oilseeds thousand tons 1,408 889 984 1,207 1,141 197 1,408 962 984 1,250 1,421 FY2021 FY2022 FY2023 FY2024 FY2025 Sunflower Soybean Rapeseed Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 18 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Oilseed Processing continued stable, as lower sunflower oil production was offset by higher soybean crushing, which in turn supported increased sales of soybean meal. Profitability, however, came under pres- sure as crushing margins narrowed signifi- cantly during the year, despite stronger vege- table oil prices. The key factor was a reduced sunflower seed harvest in Ukraine, which shifted bargaining power from crushers to farmers. With sufficient liquidity and storage capacity, farmers delayed sales until late in the season, creating a tight and highly com- petitive raw material market. This dynamic constrained margins throughout the year, with pressure most pronounced in the final quarter. EBITDA contribution from renewable energy generation amounted to USD 10 million, down 61% y-o-y, mainly reflecting a 60% in- crease in the cost of sunflower husk, the key consumable used for electricity production. Bottled oil sales added USD 12 million in EBITDA, down 13% y-o-y. As a result, EBITDA per ton of oil sold reached USD 105 in FY2025, up 86% y-o-y. However, after adjusting for the one-off USD 167 million impairment loss and USD 27 mil- lion insurance reimbursement recognized in FY2024, EBITDA per ton of oil sold declined by 30% y-o-y. This decrease underscores the adverse impact of constrained seed supply and heightened competition among proces- sors, occurring despite a 21% y-o-y increase in global sunflower oil prices. FY2026 outlook Supply-demand balance For the upcoming sunflower seed harvest, to- tal production is projected at 11.4 million tons, broadly flat y-o-y, as unchanged acreage was offset by a sharp deterioration in yields. Pro- longed drought in the south and east severely reduced crop potential, and while conditions in the north and west were more favorable, they were insufficient to counterbalance the overall decline. At the same time, Ukraine’s sunflower seed crushing capacity is expected to rise to 21 million tons with the commissioning of new processing plants. This will widen the gap be- tween available feedstock and processing de- mand to a record 9.7 million tons, intensifying competition for raw materials and further pres- suring margins across the industry. Soy and rapeseed export duties In July 2025, the Ukrainian parliament intro- duced a 10% export duty on soybeans and rapeseed, which became effective in Septem- ber 2025 following the President’s approval. The duty applies only to traders exporting these oilseeds, while agricultural producers exporting their own harvest are exempt from the duty. Such a measure is intended to stim- ulate domestic processing of these oilseeds, reduce the scale of shadow exports, and in- crease exports of higher value-added prod- ucts such as oils and meals. The initiative is expected to support higher processing volumes of soybeans and rape- seed by domestic processors. At the same time, a number of new processing facilities are under construction, with several close to com- missioning. The direct impact on the Group is anticipated to be limited, as its existing oilseed processing facilities already operate at a utili- zation rate of 87%. Ukraine has prior experience with the intro- duction of restrictive export duties, most nota- bly on sunflower seeds, which laid the founda- tion for the development of a strong domestic sunflower processing industry and enabled the country to become a global leader in sun- flower oil production. …………………………………………………………………………………… Oilseed Processing segment EBITDA 51 (70) 270 83 148 37 (73) 237 56 105 FY2021 FY2022 FY2023 FY2024 FY2025 USD million USD / ton of oil sold Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 19 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Infrastructure and Trading The uninterrupted functioning of the Black Sea com- mercial navigation corridor, established by the Ukrainian Navy in October 2023, was the most im- portant factor impacting the operational performance of the Infrastructure and Trading segment throughout FY2025. This stability enabled the Group to export 5.4 million tons of grain, slightly below the previous year’s volume. More than 95% of exports were trans- shipped through the Group’s grain terminal in Chor- nomorsk, while the remainder was routed via Danube ports. Despite the observable shortage of the grains available for export this season, Kernel maintained its position as Ukraine’s largest grain exporter, with market share rising by 2pp to 12%. The Group also leveraged its extensive infrastructure platform, handling a record 9.1 million tons of grain, edible oils, and vegetable meals through its export terminals – the highest transshipment volume in Kernel’s history. This achievement highlights the strategic importance of Kernel’s integrated infrastruc- ture, which remains a key competitive advantage in sustaining export leadership under highly challeng- ing market and wartime conditions. From a financial perspective, the Infrastructure and Trading segment recorded EBITDA of USD 218 mil- lion, representing a 7% y-o-y increase. Avere’s trad- ing business contributed USD 99 million in EBITDA, reflecting exceptional trading gains supported by market expertise and disciplined risk controls, though such performance remains highly volatile. Mean- while, grain origination and export operations in Ukraine delivered USD 119 million in EBITDA, down 21% y-o-y, as limited grain supply weighed on export volumes and margins. FY2026 Outlook For the upcoming financial year, the Group’s export operations will remain highly dependent on the ac- cessibility of Black Sea ports, with exportable grain volumes continuing to be a key determinant of finan- cial and operational results. In the first months of the new financial year, trading activity remained sub- dued, primarily due to weak farmer selling, as pro- ducers were reluctant to release stocks while antici- pating higher price levels. This temporary slowdown is expected to sustain pressure on margins in the near term. The Group targets to reach grain exports of 6.6 mil- lion tons in FY2026, while continuing to leverage its unique export value chain to navigate ongoing geo- political and market challenges. In October 2025, the reconstruction of the Group’s grain transshipment terminal in Chornomorsk, damaged by a Russian missile strike in 2023, is expected to be completed. Upon commissioning, the terminal’s transshipment capacity will be fully restored to its pre-strike level of 10 million tons per annum. Exported 5.4 million tons of grains EBITDA (before unallocated head office expenses) USD 218 million +7% y-o-y Revenue USD 2,169 million +8% y-o-y INFRASTRUCTURE AND TRADING Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 20 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Infrastructure and Trading continued Market overview The key market factors impacting the perfor- mance of the Infrastructure and Trading seg- ment include the size of the grain harvest in Ukraine, the availability of Ukrainian Black Sea ports for export operations, and global grain price dynamics. Additional factors in- clude competition among grain traders and grain infrastructure assets, to name a few. Grain supply and export in Ukraine In FY2025, Ukrainian farmers harvested 55 million tons 1 of grain, a 7% y-o-y decline. While acreage under major crops remained unchanged at around 10 million hectares, a severe summer drought significantly reduced yields of the most productive crop, corn. Com- bined with low carry-in stocks, this resulted in a domestic grain shortage and drove an 18% y-o-y decrease in exports of grains and oilseeds to 46 million tons in FY2025. Throughout the year, grain exports were pri- marily supported by deep-water Black Sea ports, while Danube routes were used selec- tively by players for whom such logistics were more cost-efficient given the location of their core assets. In FY2025, 89% of grain volumes were shipped from Ukraine via maritime routes. However, overall terminal utilization re- mained below capacity, as the share of grain available for export has declined since the on- set of the full-scale war and has yet to recover. This was further reinforced by the lack of ex- pansion in cultivated land, constrained by the ongoing war in Ukraine. In the 2024/25 season, Ukraine ranked as the world’s fifth-largest grain exporter after the United States, Argentina, Russia, and Brazil, accounting for 8% of global grain trade 2 . Global grain prices Global wheat and corn prices remained broadly stable during the 2024/25 marketing year, shaped primarily by production dynam- ics. Wheat output expanded worldwide, exert- ing downward pressure on prices, while lower corn production provided relative price sup- port. Regional harvest pressures, shifting trade flows, and biofuel demand added further influence. Early in the season, corn prices dropped to four-year lows on weak export de- mand, but later recovered as adverse weather in South America and reduced crop expecta- tions in the EU and Black Sea tightened sup- ply. In contrast, wheat prices came under sus- tained pressure from large harvests in Aus- tralia and Argentina and intensified Russian exports, which narrowed the traditional wheat- corn price spread. 1 Three key grains: corn, wheat, and barley. Source: Kernel’s estimates as of September 2025. 2 Source: USDA, as of September 2025. In the second half of the season, both markets experienced heightened volatility. Wheat briefly rallied in February on U.S. and Black Sea crop concerns, before easing again as record South American harvests materialized and geopolitical factors softened risk premi- ums. Corn gained support in April from slow U.S. planting progress and stronger ethanol demand, but came under renewed pressure in May-June as Brazil’s record Safrinha crop and expanded U.S. acreage lifted global supply forecasts. Wheat stabilized into the summer, with a June rally driven by heavy rains in the U.S., active import demand, and drought risks in the Black Sea and China, amplified by tech- nical fund buying. In Ukraine, FOB corn prices demonstrated up- ward momentum in the first half of the season, supported by restrained farmer selling, before entering a correction phase in early 2025 amid abundant global supply from Brazil and the U.S. The market remained under pressure from structural surpluses, which limited upside potential and kept margins subdued. Wheat prices followed a similar trajectory: seasonal weakness during harvest was offset by tempo- rary support from quality premiums and slower farmer sales, but ultimately, global oversupply weighed heavily, resulting in a noticeable de- cline in prices toward the end of the reporting period. Competition among grain traders Historically, we have competed with estab- lished multinational trade houses such as COFCO, Cargill, ADM, Bunge, Louis Dreyfus, and Glencore, as well as numerous regional competitors. However, many of the multina- tional traders scaled down or exited the Ukrainian market at the onset of the full-scale war in 2022. Since then, the market has seen the rise of smaller, agile entrants that have rapidly expanded their trading activities by capitalizing on alternative export routes during periods of heightened volatility. In this environ- ment, Kernel leverages its integrated infra- structure and logistical capabilities to sustain and strengthen its competitive position. During the reporting period, farmer behavior added a further layer of complexity. Sales of harvested crops were spread more evenly across the year, rather than being concen- trated in the traditional post-harvest period. This slower pace of selling intensified compe- tition, as multinational traders responded with more aggressive origination strategies. Lever- aging their ability to operate at break-even lev- els, these players sought to capture volumes and reinforce farmer loyalty. As a result, com- petitive pressure on margins increased, and ri- valry for domestic market share intensified. …………………………………………………………………….. Top 5 grain exporters from Ukraine in FY202 5 % of total grain export Source: Ministry of Agrarian Policy and Food of Ukraine, Kernel 12% 9% 7% 6% 5% Kernel Louis Dreyfus ADM Cargill Nibulon …………………………………………………………………….. Grain exports from Ukraine by transport in FY2025 thousand tons Source: Ministry of Agrarian Policy and Food of Ukraine, Kernel 89% 7% 4% Black Sea ports Danube ports Railway Trucks 39.5 …………………………………………………………………….. Corn and feed wheat prices, FOB Ukraine USD per ton Source: Fastmarkets, Kernel 100 150 200 250 300 350 Corn Feed wheat FY2025 FY2023 FY2024 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 21 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Infrastructure and Trading continued SBM-1 Our business model The Infrastructure and Trading segment con- sists of two separate business arms: • Grain and sunflower oil export value chain in Ukraine. This arm comprises inter- connected business units that form a supply chain linking Ukrainian farmers to global markets: silo services, transportation and logistics assets, export terminals, vessels, grain origination, and export operations in Ukraine. • Avere's global physical and proprietary trading operations. Grain export business in Ukraine Kernel is the leading grain exporter from the Black Sea region and the largest from Ukraine. The Group sources grain from local growers, including its own Farming segment, and exports it from Ukraine, effectively navi- gating this low-margin business by leveraging the following: • Experienced procurement team with na- tionwide presence and deep understanding of local trends and regional peculiarities; • First-hand access to the unique in Ukraine own infrastructure – the largest private silo network, the largest private fleet of grain railcars, as well as the largest deep-water grain transshipment capacity in ports and own vessels; • Prudent risk management: locking up the margins by selling grain through forward contracts in a similar time frame as purchas- ing it from farmers on the spot market 1 ; • Client-focused approach: Kernel differen- tiates itself through strong farmer relation- ships managed via the IBuyMore CRM sys- tem and supported by numerous value- added initiatives: − In FY2025, Kernel resumed its pre-crop prepayment initiative, allocating USD 50 million to farmers. These advances provided critical liquidity support for the farmers ahead of the season while se- curing access to raw materials and re- inforcing the Company’s origination base; − Through the Open Agribusiness initi- ative, Kernel shares expertise and pro- vides various services to third-party farmers operating on a total of 159 thou- sand hectares of land. − Through the Open Agri Club platform, Kernel brings together farmers, agri- businesses, industry processing enter- prises, and scientific institutions to work together to improve technologies and find innovative and effective solutions for the sustainable development of the agricultural sector. − Kernel also provides advanced IT 1 Deviations from such approach may appear during the business disruptions caused by the war in Ukraine. 2 ISCC certification confirms that corn was produced in an environmentally and socially sustainable way, making it suitable for use in bioethanol production. solutions, such as an electronic docu- ment flow system to streamline paper- work and Transithub, a virtual truck nav- igation solution for logistics providers. − Since 2015, Kernel has been develop- ing Digital AgriBusiness (“DAB”) – a proprietary digital platform for farm management that integrates innovation with traditional agronomic practices. DAB leverages precision farming tech- nologies and AI-driven analytics, com- bined with advanced planning, model- ing, and performance tracking, to pro- vide an unparalleled level of detail and decision-making support throughout the production cycle. In FY2025, the Group began offering this platform to its part- ners, extending the benefits of DAB be- yond Kernel’s own operations. Kernel's export portfolio predominantly fea- tures corn, which constitutes approximately 60% of total grain exports. Wheat emerges as the second-largest export commodity, ac- counting for between 20% and 35% of annual exports. The remaining exports are composed of barley, soybeans, and rapeseed. Most of the exported grain is used for feed, but we also export food-quality grain (0.8 million tons of wheat in FY2025) and for bioethanol production (1 million tons of ISCC-compliant 2 corn exported in FY2025, granting a price pre- mium over conventional corn). In FY2025, more than 75% of Kernel’s grain exports from Ukraine were sold on a CIF/CFR basis, with Kernel handling sea transportation to the destination port. FOB sales accounted for almost 23% of the Group’s export volumes during the period. Silo services Kernel operates the largest private inland silo network in Ukraine, consisting of 29 si- los with a total one-time grain storage capacity of 2.3 million tons. Our network comprises both highly productive silos capable of loading shuttle trains (54 railcars) in a day, and smaller, less efficient, floor-type storage facili- ties. Strategically located in Ukraine’s key grain- producing regions, these silos provide a full range of services, including grain intake, dry- ing, cleaning, storage, and off-loading, serving both our Farming segment and third-party farmers. Grain intake begins with wheat in July and concludes with corn in November-Decem- ber, enabling seasonal turnover of more than 1.0x storage capacity. Beyond standard services, Kernel’s silo network is a critical grain origination tool. It allows procurement teams to acquire grain and sunflower seeds from within a 100-kilome- ter radius, making Kernel a preferred partner for farmers. This network also strengthens re- lationships with farmers and provides valuable insights into Ukraine’s grain supply. Transportation and logistics assets Kernel operates a fleet of transportation and logistics assets to deliver grain, sunflower oil, and meal to Ukrainian ports or for inland ex- ports. The company ranks among the seven largest rail freight shippers in Ukraine and is the leading shipper of agricultural products: • Grain railcars: Kernel is the largest private operator of grain railcars in Ukraine, holding a 10% market share with 3,400 railcars. These railcars transport grain from Kernel- owned and third-party silos to transship- ment terminals. Ownership allows Kernel to save on lease costs, though railway traction and infrastructure fees still apply. Since the war began, 8% of the Group's railcars have been stuck in Russian-occupied territories, ……………………………………………………………………………………………………………… Kernel grain export from Ukraine destina- tions million tons 51% 27% 19% 3% Europe Asia Middle East Other 5.4 ……………………………………………………………………… Kernel grain export from Ukraine million tons 69% 61% 77% 63% 57% 23% 21% 17% 30% 36% 8.0 8.0 3.7 5.5 5.4 FY2021 FY2022 FY2023 FY2024 FY2025 Corn Wheat Other Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 22 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Infrastructure and Trading continued but the remaining fleet strongly supports ex- port operations; • Specialized containers: Kernel owns 100 specialized railway containers for transport- ing grain and sunflower meal, along with 400 tank containers for sunflower oil; • Rail flatcars: the Group operates 99 flatcars to transport containers by rail; • Railway tanks: Kernel has 77 railway tanks for sunflower oil transportation (5 of those have been stuck in Russian-occupied terri- tories); • Vehicles: the Group also owns 26 tanker trucks for sunflower oil, 66 trucks with trail- ers for grain transport, and 14 jumbo trucks for Packaged Goods transportation. Export terminals Kernel is one of the largest port operators in Ukraine, with infrastructure that includes: • TransBulkTerminal in the deep-water port of Chornomorsk, the largest grain trans- shipment facility in Ukraine, with a capac- ity to handle 8.0 million tons of grain per an- num 1 . It is capable of servicing over-Pana- max vessels with deadweights of up to 100,000 tons and maximum berth loading of up to 80,000 tons. As a core asset for Ker- nel, it is critical for handling the Group’s ex- ports, with no viable alternative for this ca- pacity. • TGT-Oil terminal in Chornomorsk port, ac- quired in July 2023, with a sunflower oil transshipment capacity of 1.4 million tons per year and storage capacity of 97 thou- sand tons. It is a Group’s core asset for sun- flower oil loading to vessels. • OilExportTerminal in the deep-water port of Pivdennyi, with an annual capacity to transship 0.5 million tons of sunflower oil. • Reni-Oil terminal in the port of Reni on the Danube River, acquired in FY2024, with a capacity of 0.7 million tons of sunflower oil annually. • Danube Prom Agro terminal in the river 1 Transshipment capacity was revised following the missile attack on 19 July 2023, which damaged the terminal’s infrastructure. Upon completion of reconstruction works, the original capacity of 10 million tons per annum is expected to be restored. port of Reni, allowing export of 0.4 million tons of grain/sunflower meal per annum. Kernel’s terminals primarily handle grain (70% of total throughput in FY2025), along with veg- etable meals and edible oils. The Group also has transshipment agreements with port facil- ities in the Netherlands to support export op- erations. Vessels Kernel owns and operates the bulk carrier Rot- terdam Pearl V, with a grain cargo capacity of 50 thousand tons, and the tanker Mavka, with a sunflower oil cargo capacity of 12.5 thou- sand tons. By controlling the entire value chain – from si- los to railcars, port terminals, and vessels – Kernel enhances efficiency and reduces ex- port logistics costs. Avere operations Founded in FY2018, Avere is a 100%-owned subsidiary of Kernel. It is headquartered in Switzerland with representative offices in the USA, Singapore, the Cayman Islands, Aus- tralia, Brazil, the UK, and China. Avere’s team of 41 professionals specializes in research, trading, and execution. It focuses on merchan- dising and proprietary trading of grains, oilseeds, and related commodities in key global markets, operating independently of Kernel’s Ukrainian operations. Due to its trading nature, Avere’s financial re- sults can be volatile. Market risk is managed through various tools, including: • Drawdown: Monitoring the difference be- tween the most recent peak and trough in market value. • Value-at-Risk: Managing the maximum po- tential loss over one day with 95% confi- dence. Key developments War impact In FY2025, the Infrastructure and Trading seg- ment continued to operate under wartime con- ditions, with grain exports via Black Sea ports remaining stable since October 2023. The commercial navigation corridor established and maintained by the Ukrainian Navy func- tioned without interruption, ensuring steady maritime traffic and supporting the consistent flow of exports. Despite ongoing missile and drone strikes targeting port and railway infra- structure, as well as civilian vessels, the Group’s logistics assets were not materially af- fected. Nevertheless, the Group faced several challenges disrupting our operations: • Prolonged air alarms: For security rea- sons, all terminal activities must be sus- pended during missile and drone attacks. These interruptions extended vessel load- ing times and disrupted the regular flow of operations. In FY2025 alone, our main ter- minal was fully non-operational for a cumu- lative 30 days, excluding standard idle peri- ods under normal circumstances. Such downtime creates additional inefficiencies in logistics planning and negatively affects overall throughput. • Shortage of qualified personnel: The tightening labor market for skilled profes- sionals in Ukraine posed further challenges, particularly in maintenance and repair activ- ities. Limited availability of qualified special- ists often extends the time required to com- plete scheduled works, leading to delays in operational timetables and reduced effi- ciency. Asset reconstruction On 19 August 2023, a missile strike on the port of Chornomorsk severely damaged our Trans- BulkTerminal, destroying storage facilities, in- take infrastructure, loading equipment, and in- ventories. The attack reduced Kernel’s ……………………………………………………………………………………………………………… Kernel export terminals throughput million tons ………………………………………………………………………………………………………………………………………………………………………………………………………… …………..…………………… Repair works at the TransBulkTerminal following the Russian missile attack in 2023 70% 16% 14% Grains Edible oils Vegetable meals 9.1 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 23 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Infrastructure and Trading continued capacity by 136 thousand tons of storage and 2 million tons of annual transshipment. Given the uninterrupted export operations since Oc- tober 2023, which restored business confi- dence and underscored the strategic im- portance of the facility, the Group decided to proceed with its restoration. During FY2025, USD 11 million was invested in reconstruction works, with commissioning scheduled to begin in October 2025. Total investments in the pro- ject are expected to reach USD 19 million. Upon completion, the terminal’s transship- ment capacity will be restored to its original 10 million tons of soft commodities per annum. Over the year, the Group also successfully re- stored two silos damaged by missile attacks in 2023-2024, reinstating their original storage capacity. Headcount As of 30 June 2025, the headcount of the In- frastructure and Trading segment in- creased by 6% y-o-y to 3,056 employees, driven primarily by the hiring of additional staff at the Group’s grain silos. Performance overview Operational performance Grain export from Ukraine The functioning of the Black Sea export routes remained the key performance driver for the segment in FY2025. With near-uninterrupted port operations, more than 95% of grain export volumes were transshipped through the Group’s grain terminal in Chornomorsk, with the balance handled via Danube ports. In total, the Group exported 5.4 million tons of grain, remaining flat y-o-y. Corn accounted for 57% of total exports, wheat for 36%, with the bal- ance comprising barley and other minor crops. The prior-year comparative base, however, was distorted by the July-September 2023 blockade of the Black Sea, when the Group managed to export only 203 thousand tons of grain. Nevertheless, the Group‘s share of Ukraine’s grain exports increased by 2pp y-o-y to 12%, underscoring Kernel’s operational efficiency, strong relationships with farmers, and the competitive advantage of its export infrastruc- ture, which together reinforced our position as the country’s largest grain exporter. Kernel ac- counted for 15% of the country’s corn exports (+3pp y-o-y), 13% of wheat (+4pp y-o-y), and 12% of barley (+5pp y-o-y). However, our mar- ket share remains below the pre-war peak of 18% achieved in FY2021. Of the total exported grain, 26% was produced by the Farming segment, while the majority 1 This volume is included in the export terminal’s throughput total figure. was sourced from third-party farmers. Pro- curement from other farmers totaled 3.9 mil- lion tons, a 39% y-o-y increase, though still be- low pre-war levels. As of 30 June 2025, the Group’s grain inventories stood at 209 thou- sand tons, broadly consistent with pre-war norms, providing a stable supply base for on- going export operations. Export terminals throughput In FY2025, Kernel transshipped 9.1 million tons of agricultural goods through its export terminals, marking the highest volume in the Group’s history and a 36% y-o-y increase. Grain accounted for 70% of total transship- ment volumes, edible oil for 16%, and meal for the remainder. While the Group’s grain export volume re- mained stable compared to the previous year, the overall growth in transshipment volumes was driven by higher edible oil exports han- dled through the Group’s vegetable oil trans- shipment terminal, which became operational in January 2024, as well as by increased vol- umes transshipped for third parties. During the reporting period, the Group handled 1.5 million tons of third-party-owned goods by providing transshipment services 1 . Grain and oilseeds received in inland silos The total volume of grain received in inland silos in FY2025 declined by 3% y-o-y to 2.7 million tons. Of this total, 1.5 million tons were produced by the Group's own Farming seg- ment – 0.4 million tons lower than the previous year due to a smaller harvest size. An addi- tional 233 thousand tons were procured by the Group, with the remaining volume supplied by third-party farmers. The primary grains received were corn (1,393 thousand tons) and wheat (870 thousand tons), with a minor share made up of sunflower seeds, soybeans, and rapeseed. Railcars business The Ukrainian railcar market in FY2025 faced a pronounced structural imbalance, driven by several interrelated factors: • Reduced cargo base as the total grain and oilseed volumes available for transport de- clined noticeably during the year. Unlike the first two years of the full-scale war, when limited access to seaports created signifi- cant carry-over stocks, FY2025 was charac- terized by stable export flows via the Black Sea corridor and comparatively low stocks at the beginning of the season. The situa- tion was further exacerbated by a 4 million ton decline in the Ukrainian grain harvest, directly reducing transportation demand; • Oversupply of grain railcars, as many market participants expanded their fleets by purchasing additional units for in-house op- erations. With overall volumes now lower, this capacity expansion has resulted in a significant surplus of grain railcars in the market, intensifying competition and driving utilization rates down; • Improved railcars turnover as Ukrainian Railways enhanced operating efficiency during the year by reallocating locomotives across routes and benefiting from the more stable and predictable export operations through the Black Sea. While positive for the system overall, improved turnover fur- ther reduced the effective demand for addi- tional railcar capacity. Such an imbalance has exerted downward pressure on pricing, driving rental rates to their lowest levels in recent years and resulting in the business line’s financial results that were substantially below historical levels. Given the ongoing structural surplus in the market, this challenging environment is likely to persist in the foreseeable future. Financial results In FY2025, the Infrastructure and Trading seg- ment reported EBITDA of USD 218 million, re- flecting up 7% y-o-y. Within the segment, per- formance was shaped by two distinct business arms with contrasting dynamics. Avere’s trading business delivered an excep- tional result, generating USD 99 million in EBITDA (an 87% increase y-o-y) and account- ing for nearly half of the segment’s total, com- pared with just 26% in the prior year. This per- formance was driven by Avere’s strong exper- tise in global commodity markets, accurate as- sessment of price trends, and a disciplined risk management framework. While the out- come was exceptional, it should be noted that Avere’s earnings are inherently sensitive to ………………………………………………………………………………………………………………………………………………………… Infrastructure and Trading segment performance FY2024 FY2025 y-o-y Grain export volumes thousand tons 5,452 5,427 (0%) Export terminal's throughput (Ukraine) thousand tons 6,700 9,136 36% Grain received in inland silos thousand tons 2,802 2,719 (3%) Revenue USD million 2,011 2,169 8% EBITDA USD million 204 218 7% EBITDA margin per ton of grain exported USD 37 40 8% Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 24 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Infrastructure and Trading continued market volatility, and therefore, results of this scale are not expected to be sustained on a recurring basis. By contrast, the grain and edible oil export value chain in Ukraine generated USD 119 million in EBITDA, down 21% y-o-y. This result reflected more challenging fundamentals, as limited grain supply constrained export vol- umes, pressured origination margins, and re- duced utilization rates across export infra- structure. The performance of individual busi- ness lines varied, with each contributing differ- ently to the overall result: • Export terminals contributed more than half of the achieved EBITDA, generating USD 67 million, up 55% y-o-y, supported by record-high transshipment volumes, albeit negatively impacted by reducing transship- ment rates due to general market capacity underutilization, considering lower y-o-y harvest; • Grain origination and trading operations delivered EBITDA of USD 39 million, down 28% y-o-y, reflecting lower grain harvest in Ukraine and diminished carry-in stocks, which shifted bargaining power toward farmers and constrained trading margins; • EBITDA from the railcar business declined to USD 8 million in FY2025 from USD 22 million in the prior year. Such a decrease was primarily due to a 68% y-o-y reduction in market lease rates for grain railcars, high- lighting the іstructural imbalance in the Ukrainian railcar market as disclosed in de- tail above; • Silo services business line generated only USD 4 million in EBITDA, down 81% y- o-y, on the back of the lower demand for the drying services, the main profit driver for this segment. At the same time, the reduced need for drying and cleaning services trans- lated into lower post-harvest costs for the Group’s Farming segment; • The Group’s own fleet of vessels contributed USD 1 million in EBITDA compared with USD 12 million a year ago. This decline was mainly attributable to weaker freight rates and scheduled dry- dock surveys, during which each vessel was temporarily off-hire. FY2026 outlook Looking ahead, the performance of the Infra- structure and Trading segment will remain heavily dependent on the availability of Ukrainian Black Sea ports for export opera- tions, harvest size in Ukraine, and on further developments in the war. The presence of sea mines poses a potential risk to the stable func- tioning of export operations through the Black Sea. In response to safety concerns for civilian vessels, the Ukrainian Sea Ports Authority may be required to impose restrictions on the entry and departure of vessels. Such measures could result in a reduction of the Group’s export volumes and, consequently, adversely affect the utilization rates of its ex- port terminals. Despite these uncertainties, the Group targets an increase in export volumes of grain to 6.6 million tons in FY2026 on the back of higher expected crop size. While still below pre-war levels, this is an ambitious objective given the current market environment: • Since the onset of the full-scale war, the acreage under the three main crops (corn, wheat, and barley) has decreased by 5 mil- lion hectares, reducing the grain volumes available for export regardless of yield dy- namics. Domestic consumption of these crops has fallen by about 13% compared to pre-war levels, in line with demographic trends. However, the contraction in export- able supply has been far more pronounced. For FY2026, harvest of corn, wheat, and barley is projected at 60 million tons, with 44 million tons (up 5 million tons y-o-y) pro- jected to be available for export; • Multinational traders are reinforcing their presence in Ukraine, competing aggres- sively on origination to capture market share. Their scale and ability to operate at tighter margins create sustained pressure on both trading profitability and throughput fees, despite ongoing risks of attacks on lo- gistics infrastructure; • At the same time, farmers, supported by sufficient working capital and access to stor- age capacity, are also in a stronger position to delay sales, holding back volumes in an- ticipation of higher prices. This behavior, al- ready evident throughout FY2025, is antici- pated to persist into FY2026, becoming the new normal on the market, reshaping dy- namics, and maintaining pressure on trad- ing margins; • Competition among export terminals is set to intensify with the re-launch of the former grain transshipment facility in Odesa and the ongoing construction of a new large ter- minal in the port of Pivdennyi. These developments are expected to strengthen a structural oversupply of handling capacities, putting further pressure on margins. This situation mirrors the trend already experi- enced in the sunflower oil sector, where sig- nificant capacity expansion reshaped indus- try economics and constrained profitability; • Global grain and oilseed prices are ex- pected to remain under pressure next year. Wheat and corn face strong downward pressure from record harvests in the U.S., Brazil, and the Black Sea region, with slow import demand further weighing on prices. ……………………………………………………………………… Infrastructure and Trading segment EBITDA USD million 111 115 116 151 119 248 122 38 53 99 359 237 154 204 218 FY2021 FY2022 FY2023 FY2024 FY2025 Avere Ukraine Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 25 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Farming The Farming segment’s performance in FY2025 was shaped by a combination of positive and negative factors. A severe summer drought followed by a dry autumn reduced yields across most major crops: corn declined by 17% y-o-y to 8.4 tons per ha, wheat by 8% to 6.1 tons per ha, and soybeans by 25% to 2.2 tons per ha. As a result, total harvested volume in FY2025 decreased by 9% y-o-y to 1.7 million tons. Nevertheless, a 20% y-o-y reduction in crop production costs, driven mainly by lower post-harvest grain handling services (cleaning, drying, storage), together with stronger global grain and oilseed prices, helped mitigate the impact of the smaller har- vest. A critical factor supporting the performance was the uninterrupted availability of Black Sea export routes, which enabled the realization of 1.8 million tons of grains and oilseeds produced by the Farming seg- ment (including carry-in stock from the 2023 har- vest). This allowed the Group to enter the next finan- cial year with minimal carry-over stocks, reducing ex- posure to price volatility. As a result, the segment delivered EBITDA of USD 184 million in FY2025, up 8% y-o-y. On a per-hec- tare basis, EBITDA amounted to USD 515, with 358 thousand hectares under operation during the report- ing period. FY2026 outlook Over the coming year, the Farming segment is ex- pected to benefit from a larger harvest, primarily driven by expanded corn acreage and improved yield. However, profitability is expected to come un- der pressure as production costs per hectare are pro- jected to rise by more than 30% y-o-y, reflecting higher seed and lease expenses, elevated growing costs, and increased reliance on post-harvest ser- vices due to wetter crop conditions. Global grain and oilseed prices are anticipated to re- main supportive, though persistent volatility and global surpluses may limit revenue upside. The sta- bility of Black Sea export routes will remain critical, as any disruptions could directly affect export vol- umes and logistics costs. Reflecting stronger confi- dence among market participants, forward contract- ing has resumed, with more than 600 thousand tons of the new harvest already contracted as of 30 June 2025. Against a backdrop of continued uncertainty, Kernel remains committed to strengthening operational re- silience, driving cost efficiency, and preserving the agility needed to respond quickly to evolving market and geopolitical dynamics. Revenue USD 468 million -3% y-o-y EBITDA (before unallocated head office expenses) USD 184 million +8% y-o-y Produced 1.7 million tons of grains and oilseeds FARMING Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 26 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Farming continued SBM-1 Our business model Large-scale farming Kernel is one of the largest crop producers in Ukraine. As of 30 June 2025, the total area of leasehold farmlands under Kernel’s opera- tions amounted to 358 thousand hectares 1 , including 338 thousand hectares under 2025 crops to be sold, 4 thousand hectares of land under seeds and crops grown for in-house use, and 16 thousand hectares of fallow land 2 . In FY2025, we harvested 1.7 million tons of corn, wheat, sunflower seeds, rapeseeds, and soybeans. We operate in the central and northern regions of Ukraine, characterized by highly fertile “chornozem” black soils and sufficient precipi- tation. Our land bank is divided into five pro- duction clusters, each with a decentralized op- erational decision-making structure that ena- bles rapid responses to external factors. The central office is responsible for shaping our overall business strategy, procuring key in- puts, and overseeing operations. A spirit of healthy competition among these clusters pro- motes ongoing efficiency enhancements. Except for 2,984 hectares of irrigated land used for in-house seed production, all our farmland is rain-fed, with all the associated weather risks. We adhere to a simple crop mix dominated 1 As of 30 June 2025, the Group’s total leased land area amounted to 362 thousand hectares. 2 Of the fallow land, approximately 14 thousand hectares were not cultivated due to their proximity to active hostilities and the Russian border. by corn, sunflower, and wheat, covering a total of 80% of our farmland bank, and the re- maining percentage stands for rapeseed, soy- beans, and other minor crops. The Farming business is characterized by a long working capital cycle (~18 months), as illustrated in the “FY2025 crop production cy- cle” graph below. Leasehold land operations Approximately one-quarter of Ukraine's agri- cultural land is held by the state, municipali- ties, and state-owned companies. The remain- ing 75% consists of small land parcels, rang- ing from 1 to 10 hectares, depending on the region, owned by private individuals who ac- quired these rights during the land distribution process in the 1990s following the collapse of the Soviet Union. For the past two decades, all farmland in Ukraine has been subject to a moratorium, preventing its sale. Initially implemented in 2001, this moratorium has been repeatedly extended by the parliament, impeding the growth of the farming sector in Ukraine. Con- sequently, agricultural producers lease land from current owners, with new lease agree- ments since 2015 having a minimum term of seven years to ensure the stability of farmers' business operations. The farmland market fi- nally opened on 1 July 2021, albeit with sev- eral restrictions. The most significant of these ……………………………………………………………...……… Kernel’s farmland lease rights maturity as % of total landbank ………………………………………………………………………………………………………………………………………………………………………………………………………………………………… FY202 5 crop production cycle FY2024 FY2025 Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun July Aug Sep Oct Nov Dec Jan Feb Mar-Jun Corn Land preparation Fertilization Planting Plant protection Harvesting Selling Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun July Aug Sep Oct Nov Dec Jan Feb Mar-Jun Sunflower Land preparation Fertilization Planting Plant protection Harvesting Selling Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun July Aug Sep Oct Nov Dec Jan Feb Mar-Jun Winter wheat Land preparation Fertilization Planting Plant protection Harvesting Selling 18% 34% 28% 11% 10% < 5 years 5-10 10-15 15-20 > 20 years ……………………………………………………………………………………… Kernel’s acreage harvested by crops thousand hectares 51% 51% 41% 24% 24% 30% 31% 36% 33% 19% 15% 13% 10% 17% 26% 4% 5% 13% 26% 31% 501 499 363 359 358 FY2021 FY2022 FY2023 FY2024 FY2025 Corn Sunflower Wheat Other Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 27 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Farming continued restrictions include: • Ukrainian citizens initially were permitted to acquire agricultural land, but individual own- ership was limited to a maximum of 100 hectares. • Starting from 1 January 2024, Ukrainian-in- corporated legal entities are also allowed to purchase agricultural land, and the owner- ship cap increased from 100 hectares to 10,000 hectares for both private individuals and legal entities. • Foreign individuals and corporations, as well as legal entities with foreign sharehold- ers under the Law of Ukraine, are prohibited from purchasing land unless a nationwide referendum decides otherwise. Kernel leases all the land under operation, with lease contracts having an average ma- turity of 14 years. All lease contracts include the right of first refusal to prolong leases or to buy the land in case of being allowed to do so. We've secured the use of 10.6 thousand hec- tares of land through long-term land lease agreements, extending up until the year 2118. These agreements, known as “emphyteusis” leases, involve making a single lump-sum payment of all rent to the lessor at the agree- ment's signing. This approach enables us to ensure the continuity of our operations for an extended duration, well beyond the scope of typical farmland lease contracts. Private individuals own 89% of the landbank that we lease, and the state owns 11%. Starting from FY2020, land lease expenses are not accounted for among operating ex- penses, thus impacting segments' EBITDA, but are reflected as amortization of right-of- use assets and finance expenses attached to lease liabilities. Despite all the Group’s efforts to maintain the integrity of its landbank, some landowners 1 The Group reports its crop yields on a net basis, after post-harvest grain handling processes such as cleaning and drying. prefer not to extend the lease agreements, and as a result, the Group naturally loses part of its farmland bank, in the range of 1-2% each year. At the beginning of FY2025, the Group ex- panded its land bank by acquiring an agricul- tural enterprise with lease rights over 3.6 thou- sand hectares. This acquisition aligns with the Group’s strategy to maintain the integrity of its land bank, offsetting the natural loss of land due to the non-renewal of lease agreements by landowners. Performance overview For the 2024 crop (planted in FY2024 and sold in FY2025), the Group adjusted its crop struc- ture to reestablish sustainable farming prac- tices and restore crop rotation, which had been disrupted by Russia’s invasion of Ukraine: • Sunflower acreage was reduced by 44% y- o-y to 67 thousand hectares, or 19% of total acreage, down from the elevated levels of 33–36% maintained in 2020-2023. Alt- hough sunflower remains a highly profitable crop, excessive concentration poses agro- nomic risks, including soil water imbalance, higher pest and disease pressure, and ad- verse effects on subsequent crops. The el- evated share in 2022-2023 was a temporary response to uncertainty surrounding grain export logistics. • Corn acreage remained stable at 87 thou- sand hectares, as the crop continues to serve as a key component of crop rotation and a vital contributor to overall revenue, despite weather-related yield volatility. • Winter wheat acreage expanded by 51% y- o-y to 93 thousand hectares, representing 26% of total acreage – the highest share in Kernel’s crop structure since 2012. • The Group increased plantings of soy- beans and rapeseeds to 72 thousand hec- tares and 14 thousand hectares, respec- tively, driven by the strong profitability of oilseeds in FY2024. Notably, this decision resulted in 66% of all soybeans processed in FY2025 being sourced from the Group’s own harvest. The summer drought had a severe impact on crop development and overall production, trig- gering an earlier-than-usual start to the har- vesting campaign. Consequently, corn yields declined by 17% y-o-y to 8.4 tons per hectare, wheat by 8% to 6.0 tons per hectare, and soy- beans by 25% to 2.2 tons per hectare 1 . Sun- flower yields proved more resilient, remaining stable across the Group’s operating regions despite sharper declines in other crop-produc- ing areas of Ukraine. ………………………………………………………………………........................................................................................................................... FY202 5 harvest results Acreage thousand ha Net crop yields tons / ha 1 Harvest size thousand tons 2 FY2024 FY2025 y-o-y FY2024 FY2025 y-o-y FY2024 FY2025 y-o-y Corn 84 87 3% 10.1 8.4 (17%) 853 725 (15%) Sunflower 120 67 (44%) 2.8 2.8 (1%) 337 186 (45%) Wheat 61 93 51% 6.6 6.0 (8%) 403 560 39% Soybean 65 72 10% 2.9 2.2 (25%) 187 155 (17%) Other 3 28 39 41% 359 358 (0%) 1,780 1,626 (9%) Note 1 One ton per hectare equals 15.9 bushels per acre for corn and 14.9 bushels per acre for wheat and soybean. Note 2 For the four main crops: corn, sunflower, wheat, and soybean. Note 3 Includes pea, rapeseed, barley, forage crops and other minor crops, as well as land left fallow for crop rotation purposes ……………………………………………………………………………………… Kernel’s production of key crops thousand tons ………………………………………………………………………………………………………………………………………………………………………………………… Kernel’s crop net yields tons per hectare 2,032 2,360 1,324 853 725 449 469 332 337 186 357 395 161 403 560 187 155 2,841 3,234 1,836 1,780 1,626 FY2021 FY2022 FY2023 FY2024 FY2025 Corn Sunflower Wheat Soybean 8.0 9.3 8.8 10.1 8.4 4.9 6.1 4.6 6.6 6.0 3.0 3.0 2.5 2.8 2.8 1.2 2.0 2.9 2.9 2.2 FY2021 FY2022 FY2023 FY2024 FY2025 Ukraine Corn Wheat Sunflower Soybean Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 28 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Farming continued During the reporting period, the Farming seg- ment realized 1.8 million tons of grains and oilseeds, including 0.4 million tons of sun- flower seeds and rapeseeds processed in Ker- nel's oilseed plants and 1.4 million tons sold for export. These sales included 147 thousand tons of carry-over stocks from the 2023 crop. Consequently, the Group entered the new fi- nancial year with immaterially low carry-over stocks of approximately 4.2 thousand tons of corn and 1.4 thousand tons of soybeans, which are expected to be realized in FY2026. The Farming segment delivered an EBITDA of USD 184 million in FY2025, up 8% y-o-y, in- fluenced by several factors: • Unlike the previous year, when prices for key crops were under pressure, FY2025 was marked by a recovery in sales prices that positively influenced the segment’s per- formance. The average selling prices of our grains and oilseeds increased between 20% and 50% y-o-y, broadly aligned with global market dynamics throughout the year. • Dry weather conditions during the harvest- ing campaign contributed to lower post-har- vest service requirements. Due to excep- tionally low crop moisture levels in corn, wheat, and sunflower seeds, the need for drying and other silo services declined sig- nificantly. This translated into a notable re- duction in operating expenses, with aver- age costs per hectare decreasing by 13% y- o-y; • At the same time, a severe summer drought followed by a dry autumn constrained the growth potential of all major crops, particu- larly corn, wheat, and soybeans, resulting in a smaller crop size compared to the previ- ous year and limiting the segment’s ability to fully capitalize on favorable price dynam- ics; • The result also includes a recognized USD 7 million non-cash net gain from the change in the fair value of biological assets and ag- ricultural produce. The segment’s earnings translated into USD 515 EBITDA per hectare, with 358 thousand hectares under operations in FY2025. Headcount The headcount of the Farming segment re- mained relatively unchanged y-o-y, with 4,451 employees as of 30 June 2025. FY2026 outlook We anticipate that the Farming segment’s per- formance in the next financial year will be shaped by three key factors: harvest size, pro- duction costs, and market environment. Each of these drivers is outlined in more detail be- low. Harvest 2025 size For the FY2026 harvest, the Group further ad- justed its crop structure, restoring rotation practices that had been disrupted during the first two years of the full-scale war, when lo- gistics constraints and limited storage capacity required short-term shifts in crop mix. With conditions partially stabilized, the structure was realigned as follows: • Corn accounted for the largest share, covering 172 thousand hectares or 48% of total acreage, marking a return to the Group’s pre-war agronomic strategy fo- cused on sustainable and efficient crop ro- tation; • Winter wheat occupied 94 thousand hec- tares, equal to 26% of acreage, securing its position as the second-largest crop in the structure; • Acreage under sunflower seeds was re- duced by 31% y-o-y to 46 thousand hec- tares, or 13% of acreage. Despite this tem- porary decrease, a gradual return to a sus- tainable share of around 25% is targeted in the midterm perspective; • Soybeans were planted on 24 thousand hectares, compared with 72 thousand hec- tares in the prior season. The crop had been reintroduced into the rotation two years ear- lier as part of the Group’s strategy to reduce reliance on corn. Adverse weather patterns created atypical conditions for the 2025 crop season, shifting the development phases of grain and oilseed crops. Two waves of late spring frosts dam- aged critical growth stages of winter crops and early development of spring crops. A pro- longed cool spring and summer with sharp day-night temperature fluctuations further slowed vegetation in northern regions such as Chernihiv and Sumy. Meanwhile, central re- gions, including Poltava, Cherkasy, and Kiro- vohrad, faced insufficient soil moisture and limited rainfall, which delayed crop growth and resulted in premature wilting and early ripen- ing. As of the date of this report, the harvesting campaign is in its active phase. Unlike the pre- vious year, when harvesting began ahead of schedule due to exceptionally dry summer weather, this season the campaign com- menced a few days later than planned. The Group has already completed harvesting the spring crops, while the majority of acreage ……………………………………………………………………………………… Profitability dynamics USD million 657 635 695 481 468 461 219 221 171 184 70% 35% 32% 35% 39% FY2021 FY2022 FY2023 FY2024 FY2025 Revenue EBITDA EBITDA margin, % ……………………………………………………………………………………… Realized crops produced by Farming thousand tons 69% 67% 61% 62% 44% 11% 16% 10% 15% 34% 18% 15% 26% 14% 12% 2,963 2,321 2,490 2,295 1,786 FY2021 FY2022 FY2023 FY2024 FY2025 Corn Wheat Sunflower Soybean Rapeseeds Other Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 29 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Farming continued under corn and sunflower seeds remains to be harvested. Wheat yields decreased by 3% y- o-y to 5.9 tons per hectare, while rapeseed yields were broadly unchanged at 2.4 tons per hectare. For late crops, corn yields increased by 12% y-o-y to 9.4 tons per hectare, whereas sunflower yields declined by 4% y-o-y to 2.7 tons per hectare, based on 14% and 93% of acreage harvested, respectively. Volume-wise, the total crop size for 2025 is projected to exceed the previous year, primar- ily driven by the expansion of acreage and im- provement of yields of corn. Production costs On the cost side, the segment is expected to face significant headwinds, with average pro- duction costs per hectare projected to rise by 33% y-o-y. Wetter crop conditions are likely to increase demand for drying and other post- harvest services, while higher seed prices and elevated growing expenses will further add to the cost base. In addition, land lease costs are projected to increase by 31% y-o-y. Taken to- gether, these factors may partially offset the benefits of higher production volumes and a relatively stable pricing environment. Market environment Global grain and oilseed prices continue to de- termine agricultural commodity pricing in Ukraine. Forecasting selling prices remains challenging amid persistent volatility in world- wide supply and shifting trade flows. Current market observations suggest that even strong yields may not translate into higher revenues for the Farming segment, as global surpluses continue to outweigh local production gains. Historically, the Group contracted part of its grain harvest in advance. However, such prac- tice was suspended following the onset of the full-scale war, as heightened uncertainty raised concerns among buyers regarding the reliability of deliveries. With export routes through the Black Sea ports stabilized since October 2023, forward contracting of the new harvest was resumed closer to the end of FY2025. As of 30 June 2025, more than 600 thousand tons of grain have already been con- tracted. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 30 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Risk management GOV-5 Risk management system The Group’s management defines risk as an event, action, or lack of action, which can lead to failure to achieve the Company’s objectives. Kernel has an evolving system of risk man- agement aimed at preserving the stability and solvency of the Company under ex- treme conditions to secure long-term sus- tainable value for shareholders. Based on the Risk Management Policy (adopted by the Board of Directors in Novem- ber 2018) and underlying policies and proce- dures, Kernel monitors and assesses its risk exposures regularly and takes steps to mini- mize their impact. Key roles The Company’s risk management is realized by the Board of Directors, Executive Manage- ment Team, and other management and staff, starting from strategy development and im- pacting all activities and processes of the Company. These activities set out to identify and manage risks, to provide reasonable as- surance of the Company’s goals accomplish- ment. Please see the details in the “Key roles and duties in the risk management process” chart. Risk management cycle The risk management cycle includes five stages: • risk identification; • risk assessment and prioritization; • development and execution of mitigation plan; • monitoring of mitigation plan execution; • risk management process enhancement. Risk categories The management classifies all risks into five categories: • Strategic (Business) • Operational • Financial • Regulatory • Sustainability ………………………………………………………………………………………………………………………………………................ Kernel’s risk identification and mitigation system ……………………………………………………………………………………………………………………………………….................. Key roles and duties in the risk management process CEO  owner of the risk management process for the Company as a whole;  responsible for implementing the risk management strategy and functioning of the effective risk management system. Board of Directors Risk Committee of the Executive Management Team Audit Committee Assists the Board of Directors in the discharge of its risk man- agement responsibilities:  formulating the description of the risks specific to the Com- pany;  overseeing adequacy and effectiveness of Kernel’s risk management system;  reviewing the Company’s policies on risk assessment and risk management.  supervise the risk manage- ment process;  determine and approve the level of risk acceptability and Company’s risk appetite;  decide on critical and signifi- cant risks;  review the risk related reports.  ensure the introduction and implementation of the risk management policy and procedures;  develop and continuously improve an effective risk management and monitoring system, spreading the culture of decision-making in terms of risks, their valu- ation and likelihood of occurrence;  coordinate roles and participants;  identify, assess, manage and control key risks;  coordinate updating and improvement of the internal control system. Internal Audit  assess the adequacy and effectiveness of risk man- agement processes and internal controls in opera- tions;  assist Directors on operational risk identification, as- sessment, and prioritization in operations;  implementation, status monitoring, internal controls, and mitigation activities of action plan of operational risks;  assist, advise and consult management in improving the effectiveness of risk management and internal control systems in operations. Directors and executives risk owners within their functional duties  Identification of risks;  Assessment of risks;  Making and implementing deci- sions on risks mitigating actions. Risk identification Risk assessment and prioritization Development and execution of mitigation plan Monitoring of mitigation plan execution Risk manage- ment process enhancement 1 2 3 4 5 Risk management cycle Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 31 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Risk management continued Top 10 risks This section includes a summary of the main risks that Kernel may face during the normal course of its business. However: • this section does not purport to contain an exhaustive list of the risks faced by Kernel, and Kernel may be significantly affected by risks that it has not identified or considered not to be material; • some risks faced by Kernel, whether they are mentioned in this section or not, may arise from external factors beyond Kernel’s control; • whereas mitigations are mentioned in this section, there is no guarantee that such measures will be effective (in whole or in part) to remove or reduce the effect of the risk; • investors may face other risks when dealing with Kernel securities (shares and bonds). As a result of the latest review cycle, the Board approved the Top 10 risks for the Group for FY2026 as depicted on the risk matrix. A list of risks, together with disclosure of changes in assumptions on impact and probability, is pre- sented in the table below. ………………………………………………………………….………………………………………………………………………............ Risks matrix 1 2 3 4 5 6 7 8 9 10 Risk impact Risk Probability Very low Low High Very high Severe MajorModerate Minor Medium Medium Strategic (Business) risks Operational risks Change y-o-y # Risk Name Change in estimates FY2026 vs FY2025 Rationale on changes in estimates Impact Probability 1 Weak harvest in Ukraine No change Decrease • Decreased probability as the 2025 harvest is projected to improve compared to the previous season; however, the impact remains significant due to underutilized country’s handling capacities. 2 Logistics disruptions No change Decrease • Decreased probability, reflecting stable export operations through Black Sea ports throughout FY2025. 3 Loss of critical infra- structure No change No change • Impact and probability remain unchanged as the threat of targeted attacks on infrastructure persists. 4 Low global soft com- modity prices Decrease Increase • Increased probability driven by the anticipated high corn and wheat harvests worldwide, exerting downward pressure on prices. 5 Loss of Inventories Increase No change • Increased impact driven by the higher forecasted export volumes, which will re- quire the accumulation of inventories at terminals to support the increased throughput. 6 Trade position risk due to unforeseen market volatility No change No change • Impact and probability of trade position risk remain unchanged , as exposure to unforeseen market volatility continues to be managed at a consistent level. 7 Credit and counterparty risks Increase Decrease • Increased impact as expected higher volumes of purchases from third-party sup- pliers will raise the Group’s exposure to potential counterparty non- performance and related financial and operational losses. 8 Information security and IT risks No change No change • No changes as result of the mitigating actions implemented. 9 Disruption or limitation of electricity supply Decrease Decrease • Decreased impact and probability supported by the ongoing development of the alternative energy market in Ukraine. 10 Human capital risks Increase Increase • Increased impact and probability due to the sustained labor market shortage resulting from continued emigration, internal displacement to safer regions, and the ongoing uncertainties associated with mobilization despite partial exemptions for critical personnel. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 32 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Risk management continued Kernel FY2026 Top 10 risks and mitigating factors Risk Possible impact Mitigating factors 1. Weak har- vest in Ukraine • Subdued Farming segment EBITDA be- cause of reduced total harvest size due to unfavorable weather conditions, while the cost base remained unchanged. • Low crushing margins due to higher competition among crushers for the limited supply of oilseeds. • Low capacity utilization of the Company’s oilseed processing plants due to the deficit of the oilseeds on the market; • Low profitability of the grain ex- port value chain (underutilized in- frastructure capacities or de- pressed margins), given that a ma- jor portion of our grain export vol- umes originates from third-party farmers.  A diversified land bank reduces to some extent the overall Farming segment's exposure to weather risks.  Diversified oilseeds origination base: • Our oilseed origination areas cover the whole sunflower seed growing belt in Ukraine, thus reducing our exposure to weather volatility in any particular region. • Comprehensive data-driven procurement strategy based on re- gional supply-demand balances composed of the official statis- tics, market consensuses, and inputs from our farming and pro- curement teams.  Multi-seed processing: the ability to adjust oilseed processing mix to mitigate the deficit of the sunflower seed on the market.  “Open Agribusiness” and “Open Agri Club” platforms help third- party farmers increase productivity through access to expert agro- nomic knowledge, modern technologies, and financing opportunities. By offering crop consulting, digital tools, and tailored services, these platforms strengthen farmer loyalty and reinforce Kernel’s role as a reliable originator of grains and oilseeds;  Pre-crop financing of third-party farmers conditional upon obligatory sale of future harvest (sunflower seeds and grain) to Kernel, thus cov- ering part of our needs. Use of various credit enhancement instru- ments when providing financing (e.g., future crop pledge agreements, agri-notes, etc.). 2. Logistics disruption: closed Ukrainian seaports due to the war; • Reduction in export volumes of grain, sun- flower oil, and meal in case of continued dif- ficulties with the export of agriproducts via the Ukrainian Black Sea ports (a usual and most convenient export route for Ukrainian agricultural products); • Growing logistics costs (railway in Ukraine and EU, truck and barges services) caused by substituting cheap sea freight with more expensive in-land and river logistics with multi-modal transshipment. • Increase in the shipment time resulting in more working capital required; quality deteri- oration of goods due to long-time multi- modal transportation.  In case of Ukrainian Black Sea ports being blocked, the Group will focus on transshipments via Ukrainian Danube River ports and railway deliveries to Constanta port in Romania, as other export channels proved to be not so efficient (higher costs and lower throughput capacities);  Capacity expansion. For the facilities under control, the Group un- dertakes regular capacity expansion initiatives;  Diversified load points in ports to mitigate risks related to any par- ticular port. The Group has secured transshipment capacities in the following ports: Pivdennyi, Chornomorsk, and Reni. Additionally, the Group arranged for the provision of transshipment services with op- erators in the Rotterdam port in the Netherlands;  Own fleet in operations to support deep-water and river logistics. 3. Loss of critical infrastructure • Undermined earnings generation capac- ity and additional CapEx required due to potential loss or damages of critical infra- structure (export terminals, oilseed extrac- tion plants, key silos) as a result of Russian missile or drone attacks.  Diversified asset base located relatively far from the regions of ac- tive military actions;  Grain and oil transshipment agreements with third-party export terminals;  Diversified load points in ports. 4. Low global soft commod- ity prices: grain and oilseeds, sunflower oil • Undermined profitability of the Group’s Farming segment (which is always in a naturally long position as a typical up- stream business) in the case of low global grain and oilseeds prices. • Undermined profitability of the Group’s Infrastructure and Trading segment, as low prices do not allow to absorb high logis- tics costs, and farmers prefer to wait with sales of grain. • Compressed margins in the Oilseed Pro- cessing segment: low prices for sunflower oil reduce combined earnings shared by farmers and crushers in Ukraine in the short term and discourage farmers from  Hedging grain prices: we use various hedging tools, including CME corn and soybean futures and options, forward contracts for the Black Sea origin premium, and direct forward contacts (if available). Physi- cal delivery forward contracts (if available) are typically used for shorter duration hedging, normally within six months;  A longer period of crop sales: under normal conditions, we start selling next year’s crop as soon as we have the initial understanding of the next year’s production costs, considering also the entire value chain margin;  Partial flexibility in determining the timing of sale of own crop, allowing to avoid sales during extremely low-price periods;  Deep analysis of global soft commodity fundamentals: Avere re- search and trading unit provides insights into the global soft commod- ity market, guiding the selection of proper timing and pricing of our hedging operations.  Active procurements of sunflower seeds at the beginning of the Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 33 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Risk management continued Kernel FY2026 Top 10 risks and mitigating factors Risk Possible impact Mitigating factors expanding acreage under sunflower in the long term. season (when a huge post-harvest supply of sunflower seeds allows for negotiating more attractive prices) to partially mitigate long-term sunflower oil price weakness;  Careful sales management during the season to mitigate seasonal price declines. 5. Loss of in- ventories • Physical loss of the Group’s inventories due to Russian missile or drone attacks.  Expanding the Group’s export capacities via alternative routes;  Investments into additional storage capacities (including plastic silo bags);  Diversified load points in ports;  Minimizing onsite storage in ports in favor of direct loading. 6. Trade posi- tion risk due to unforeseen market volatil- ity • Losses arising from the Group’s trade po- sition mismanagement. For example, an open position in sunflower oil may hurt the Company’s earnings in case of significant movements in sunflower oil prices; • Losses arising from Avere trading busi- ness.  Trade position control system: − daily monitoring of maximum long/short limits, with separate limits for different goods (e.g., sunflower oil from own seeds, purchased seeds, or third-party purchases).Specific limits are set for sun- flower seed procurement not covered by sunflower oil sold. Special approvals are required to exceed the limits. − certain positions are controlled by restricting Value at Risk and drawdown limits with daily monitoring. − constant monitoring of market price movements on existing trade positions, with continuous improvements to the monitoring system.  “Balanced book ” policy: mitigates commodity price fluctuations through price and volume hedging. Such a policy presupposes the arrangement of forward contracts for sunflower oil sales, alongside the procurement of sunflower seeds from farmers. In such a manner, the Company reduces risk exposure by ensuring the sales volumes, as well as locking the selling price. Deviations from this approach may occur within certain trade limits approved by the management or be- yond such limits in specific cases (separate management decision is required);  Centralized contract execution and scheduling of shipments. 7. Credit and counterparty risks • Defaults of third-party farmers under fi- nancing received from the Group (includ- ing the Open Agribusiness program); • Losses arising due to the Group’s counter- parties not performing their trade obliga- tions. • Imposition of fines and criminal liability for violation of sanctions.  Clearly defined parameters and strict selection criteria for farm- ers applying for financing programs from the Group, along with high- quality contract preparation to safeguard Kernel’s interests as a cred- itor;  Constant monitoring of solvency and business performance of the farmers who received financing from the Group;  Negotiating with farmers on extending the obligations repayment pe- riod or agreeing on alternative ways of repayment;  Active restructuring and claim work against counterparties in de- fault;  Comprehensive due diligence of counterparties across all business areas. Cooperation with unverified counterparties is strictly prohib- ited, as is contract signing or payments prior to completion of verifi- cation. 8. Information security and IT risks • The loss or disclosure of key information may threaten business operations and de- velopment of the business; • Interruption of business processes and decisions which are dependent on the con- tinuity of IT applications and infrastructure. • Leakage of the information stored at assets currently occupied by Russia; • Cyber-attacks on the Group’s IT infrastruc- ture; • Damage to the Group’s cloud IT infrastruc- ture occurred due to the military actions in Ukraine; and lack of access to cloud services provided outside of Ukraine.  The backup data center was relocated to Lviv (Western Ukraine);  Access to the IT systems is denied at night for developers and contractors;  Implemented IT business continuity and data recovery policy;  Multifactor authentication is being implemented to reduce the risk of documents, correspondence, and other confidential data leakage;  Password policy, access control for external users to company IT systems; Privileged access management solutions.  Regular testing of the IT recovery plan; regular vulnerability testing from inside and outside;  Patch management policy – regular installations of critical and se- curity patches on servers and workstations;  Special solution to combat the advanced persistent threat (APT) and 0-day virus attacks;  Implementation of incident and change management processes in the IT infrastructure; Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 34 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Risk management continued Kernel FY2026 Top 10 risks and mitigating factors Risk Possible impact Mitigating factors  Improving the maturity of the access management process by auto- mating the process of reviewing access rights.  Regular training and testing of employees for knowledge and com- pliance with information security rules. 9. Disruption or limitation of electricity sup- ply • Disruption of oilseed processing • Reduction in export volumes of grain, sun- flower oil, and meal in case of continuing blackout.  Alternative electricity source. Major production and export sites are equipped with diesel-powered electricity generation, allowing them to continue operations during blackouts, although not always at full ca- pacity.  The Group’s own co-generation heat and power plants serve to mitigate power disruption risks. 10. Human cap- ital risk • Disruptions in business and support pro- cesses due to: − a shortage of staff in general and the challenge of replacing key employees due to the low qualifications of new can- didates, exacerbated by significant emi- gration from Ukraine; − employee conscription for military ser- vice, a consequence of the protracted war in Ukraine; − increased mental stress among remain- ing employees as a result of the ongoing and prolonged war in Ukraine.  Competitive compensation: pay levels meet or exceed industry benchmarks and are regularly reviewed to stay competitive in Ukraine and neighboring markets. The compensation system is regularly re- viewed to align with the Company's strategy and HR strategy. We regularly measure employee satisfaction levels and react to the re- sults;  Extensive social package: housing repayable loans for young em- ployees in the regions, voluntary medical insurance (full coverage for employees, 50% for children), and targeted financial support in diffi- cult life situations;  Talent development: education programs with extensive coverage and a system of individual development and career planning, as well as mental health education (as disclosed in the Sustainability section of the annual report);  Safe and convenient working conditions: continuous improvement of workplace safety and infrastructure, with flexible work options and support for employee networks;  Effective recruitment and onboarding: we attract talent through di- verse recruitment channels, partnerships with universities and the business community, and via the dedicated Kernel Chance program, complemented by comprehensive adaptation programs to integrate new employees effectively;  Employee involvement through an effective KPI system, responsi- bility delegation, rewards for operational efficiency improvement, and teambuilding events;  Employer brand: active HR brand development to strengthen Ker- nel’s reputation as a responsible and sustainable employer. Other risks identified by the Company’s management include (but are not limited to):  Liquidity associated risks;  Failure to maintain the integrity of the leasehold farmland bank;  Fraudulent activities;  A shortfall of proceeds from sales of renewable energy;  Investment projects management associated risks;  Increase in competition;  Sustainability-related risks: non- compliance with environmental standards; undermined profitability due to more severe environmental require- ments applicable to farming and oilseed processing related to the implementation of the European Green Deal; low sus tainability rating of Kernel may increase the cost of capital;  Weak economic growth, either globally or in the Group’s key markets;  Economic policy, political, social, and legal risks and uncertainties in countries other than Ukraine in which Kernel Holding S.A. operates;  Any loss or diminution in the services of Mr. Andrii Verevskyi, Kernel Holding S.A.’s chairman of the Board of Directors;  The risk that changes in the assumptions underlying the carrying value of certain assets, including those occurring as a resu lt of adverse market conditions, could result in the impairment of tangible and intangible assets, including goodwill;  The risk of fluctuations in the exchange rate of the Ukrainian hryvnia to the US dollar;  The risk of disruption or limitation of natural gas;  The risk of product liability claims;  The risk of potential liabilities from investigations, litigation, and fines regarding antitrust matters;  The risk that Kernel Holding S.A.’s governance and compliance processes may fail to prevent regulatory penalties or reputatio nal harm, both at operating subsidiaries and in joint ventures; and  The risk that Kernel Holding S.A.’s insurance policies may provide inadequate coverage. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 35 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Alternative Performance Measures To comply with the ESMA Directive on Alter- native Performance Measures (“APMs”), Ker- nel Holding S.A. (hereinafter, the “Group”) presents this additional disclosure, which en- hances the comparability, reliability, and com- prehension of its financial information. The Group presents its results in accordance with generally accepted accounting principles (IFRS), but management considers that cer- tain supplemental non-IFRS measures, such as • EBITDA; • EBITDA margin; • Segment EBITDA; • Segment EBITDA margin; • Investing Cash Flows net of Fixed As- sets Investments; • Net Fixed Assets Investments; • Operating Cash Flows before Working Capital Changes; • Free Cash Flows to the Firm; • Debt Liabilities; • Net Debt; • Commodity Inventories; • Adjusted Net Debt; and • Adjusted Working Capital; (together, the “Alternative Performance Measures”) provide investors with a supple- mental tool to assist in evaluating current busi- ness performance. The Group believes the Alternative Perfor- mance Measures are frequently used by se- curities analysts, investors, and other parties interested in evaluating companies in the Group’s industry. The Alternative Perfor- mance Measures have limitations as analyti- cal tools, and investors should not consider any of them in isolation or any combination of them together as a substitute for analysis of the Company’s operating results as reported under IFRS. Other companies in the industry may calculate these Alternative Perfor- mance Measures differently or may use them for different purposes than Kernel Holding S.A., limiting their usefulness as comparative measures. Each of the Alternative Perfor- mance Measures is defined below. EBITDA and EBITDA margin The Group uses EBITDA 1 as a key measure of operating performance, and it is defined as profit from operating activities, adding back depreciation and amortization. The Group defines EBITDA margin as EBITDA divided by revenue during the re- ported period. Kernel Holding S.A. views EBITDA and 1 In other documents (e.g. listing particulars) the Group could use the term Adjusted EBITDA, which is calculated as profit before income tax adding back net finance costs, net foreign exchange gain, net other expenses, share of income/(loss) of joint ventures, and amortization and depreciation, and coming to the same result as EBITDA EBITDA margin as the key measures of the Group’s performance. The Group uses EBITDA and EBITDA margin in its public re- porting, which is also related to the listing of the Company’s equity on the Warsaw Stock Exchange. The Group believes that these measures better reflect the Group and its sub- sidiaries’ core operating activities and provide both management and investors with infor- mation regarding operating performance, which is more useful for evaluating the finan- cial position of the Group and its subsidiaries than traditional measures, to the exclusion of external factors unrelated to their perfor- mance. EBITDA and EBITDA margin have limitations as analytical tools, and investors should not consider these measures in isolation or in any combination with Non-IFRS Measures as a substitute for analysis of the Group’s operating results as reported under IFRS. Some of these limitations are as follows: • EBITDA and EBITDA margin do not reflect the impact of finance costs, the significance of which reflects macroeconomic conditions and has little effect on the Group’s operating performance; • EBITDA and EBITDA margin do not reflect the impact of taxes on the Group’s operat- ing performance; • EBITDA and EBITDA margin do not reflect the impact of depreciation and amortization on the Group’s performance. The assets of the Group, which are being depreciated and/or amortized, will need to be replaced in the future, and such depreciation and amortization expenses may approximate the cost of replacing these assets in the fu- ture. By excluding this expense from EBITDA and EBITDA margin, such measures do not reflect the Group’s future cash requirements for these replacements; • EBITDA and EBITDA margin do not reflect the impact of share of income/loss of joint ventures, which are accounted under the equity method; • EBITDA and EBITDA margin do not reflect the impact of foreign exchange gain/(loss), which the Group does not consider to be part of its core operating performance be- cause the main difference arises on trans- actions between entities of the Group with different functional currencies; • EBITDA and EBITDA margin do not reflect the impact of other expenses, as such ex- penses are not a part of the Group’s core operations. …………………………………………………………………………………………………………………………………………………... Reconciliation of profit from operating activities to EBITDA and EBITDA margin: in thousand USD except the margin FY2024 FY2025 Profit from operating activities 276,428 361,046 add back: Amortization and depreciation 104,723 105,283 EBITDA 381,151 466,329 Revenue 3,581,462 4,115,042 EBITDA margin 11% 11% Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 36 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Alternative Performance Measures continued Segment EBITDA and Segment EBITDA margin The Group uses Segment EBITDA and Seg- ment EBITDA margin as the key measures of segment operating performance. The Group defines Segment EBITDA as profit/(loss) from operating activities adding back amortization and depreciation. The Group defines Segment EBITDA margin as Segment EBITDA divided by the segment revenue during the reporting period. Investing Cash Flows net of Fixed As- sets Investments The Group uses Investing Cash Flows less Net Fixed Assets Investments as a measure of its expenditures on investments other than property, plant and equipment and it is defined as net cash used in investing activities, adding back: • purchase of property, plant and equipment; • proceeds from disposal of property, plant, and equipment. Net Fixed Assets Investments The Group uses Net Fixed Assets Invest- ments as a measure of its expenditures on fixed assets maintenance, and it is defined as net cash used in investing activities less In- vesting Cash Flows net of Fixed Assets In- vestments or, alternatively, may be calcu- lated as cash used for purchase of property, plant and equipment less proceeds from dis- posal of property, plant, and equipment. Operating Cash Flows before Working Capital Changes The Group uses Operating Cash Flows as a measure of the cash generation of its core business operations and it is defined as net cash generated by operating activities less changes in working capital, including: • change in trade receivables and other finan- cial assets; • change in prepayments and other current assets; • change in restricted cash balance; • change in taxes recoverable and prepaid; • change in biological assets; • change in inventories; • change in trade accounts payable; and • change in advances from customers and other current liabilities. …………………………………………………………………………………………………………………………………………………... Calculation of Segment EBITDA and Segment EBITDA margin: in thousand USD except the margin FY2024 FY2025 Oilseed Processing Profit from operating activities 49,642 112,926 plus Amortization and depreciation 33,734 34,821 Segment EBITDA 83,376 147,747 Segment revenue 1,863,798 2,106,649 Segment EBITDA margin 4% 7% Infrastructure and Trading Profit from operating activities 175,536 189,098 plus Amortization and depreciation 28,255 29,034 Segment EBITDA 203,791 218,132 Segment revenue 2,011,138 2,168,808 Segment EBITDA margin 10% 10% Farming Profit from operating activities 131,966 146,811 plus Amortization and depreciation 38,836 37,581 Segment EBITDA 170,802 184,392 Segment revenue 481,359 468,205 Segment EBITDA margin 35% 39% Other Loss from operating activities (80,716) (87,789) plus Amortization and depreciation 3,898 3,847 Segment EBITDA (76,818) (83,942) …………………………………………………………………………………………………………………………………………………... Reconciliation of net cash used in investing activities to Net Fixed Assets Investments: in thousand USD FY2024 FY2025 Purchase of property, plant and equipment (142,578) (72,956) Proceeds from disposal of property, plant and equipment 10,175 4,841 Net Fixed Assets Investments (132,403) (68,115) …………………………………………………………………………………………………………………………………………………... Reconciliation of net cash used in investing activities to Investing Cash Flows net of Fixed Assets Investments : in thousand USD FY2024 FY2025 Net cash used in investing activities (112,548) (40,343) Adding back: Purchase of property, plant and equipment (142,578) (72,956) Proceeds from disposal of property, plant and equipment 10,175 4,841 Investing Cash Flows net of Fixed Assets Investments 19,855 27,772 …………………………………………………………………………………………………………………………………………………... Reconciliation of net cash generated by operating activities to Operating Cash Flows before Working Capital Changes : in thousand USD FY2024 FY2025 Net cash generated by operating activities 472,136 241,664 Less: Changes in working capital, including: (21,322) (102,581) Change in trade receivable and other financial assets (8,803) 3,579 Change in prepayments and other current assets 30,859 36,872 Change in taxes recoverable and prepaid 36,391 (10,455) Change in biological assets (17,181) 17,010 Change in inventories (16,899) (143,493) Change in trade accounts payable (45,292) (7,203) Change in advances from customers and other current lia- bilities (397) 1,109 Operating Cash Flows before Working Capital Changes 493,458 344,245 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 37 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Alternative Performance Measures continued Free Cash Flows to the Firm The Group uses Free Cash Flows to the Firm as a measure of the cash generation of its core business operations and it is defined as the sum of net cash generated by the operating ac- tivities and the net cash used in investing activ- ities. Commodity Inventories The Group uses Commodity Inventories (hereinafter “CI”) as an additional measure of its liquidity, which the Group uses to provide a sup- plemental tool to assist in evaluating current business performance and in calculating credit ratios under certain of the Group’s financing ar- rangements. The Group defines CI as agricul- tural inventories, such as corn, wheat, sun- flower oil, and other products that were easily convertible into cash before the Russian inva- sion of Ukraine, given their commodity charac- teristics, widely available markets, and the inter- national pricing mechanism. The Group used to call such inventories “Readily marketable in- ventories”, but after the beginning of the war in Ukraine, the Group faced difficulties with selling such inventories, and therefore, such invento- ries cannot be considered as readily marketa- ble any longer. Debt Liabilities The Group uses three metrics as the measure of its leverage and indebtedness, which con- sists of Debt Liabilities, Net Debt, and Ad- justed Net Debt. The Group defines Debt Li- abilities as the sum of: • bonds issued; • current bond issued • interest on bonds issued; • long-term borrowings; • current portion of long-term borrowings; • short-term borrowings; • lease liabilities and • current portion of lease liabilities. The Group defines Net Debt as Debt Liabili- ties less cash and cash equivalents and cash deposits pledged under credit facilities. Fi- nally, the Group defines Adjusted Net Debt, as Net Debt less commodity inventories. Adjusted Working Capital The Group uses Adjusted Working Capital as a measure of its efficiency and short-term liquidity which is defined as current assets (ex- cluding cash and cash equivalents, and assets classified as held for sale) less current liabili- ties (excluding the short-term borrowings, the current portion of long-term borrowings, cur- rent portion of lease liabilities, the current bond issued, the interest on bonds issued, and liabilities associated with assets classified as held for sale). …………………………………………………………………………………………………………………………………………………... The following table shows the Group’s key inventories considered eligible for CI by type and the amounts of such inventory that the Group treats as CI as in the periods indicated: in thousand USD As of 30 June 2024 As of 30 June 2025 Sunflower oil & meal 93,850 208,226 Sunflower seed 84,789 46,171 Grains 67,839 43,937 Other 31,182 65,133 Total 277,660 363,467 of which: Commodity Inventories 246,749 298,549 …………………………………………………………………………………………………………………………………………………... Calculation of Debt Liabilities, Net and Adjusted Net Debts as on the dates indicated: in thousand USD As of 30 June 2024 As of 30 June 2025 Bonds issued - 298,487 Current bonds issued 597,580 - Interest on bonds issued 7,612 3,616 Long-term borrowings - 82,307 Current portion of long-term borrowings - 22,239 Short-term borrowings 315,166 148,887 Lease liabilities 142,534 171,234 Current portion of lease liability 27,206 34,021 Debt Liabilities 1,090,098 760,791 less: cash and cash equivalents 809,584 617,511 Net Debt 280,514 143,280 less: commodity inventories 246,749 298,549 Adjusted Net Debt 33,765 (155,269) …………………………………………………………………………………………………………………………………………………... Reconciliation of total current assets to Adjusted Working Capital as at the dates indicated: in thousand USD As of 30 June 2024 As of 30 June 2025 Total current assets 2,155,355 2,004,295 less: Cash and cash equivalents 809,584 617,511 Total current liabilities 1,367,062 666,854 add back: Short-term borrowings 315,166 148,887 Current portion of long-term borrowings - 22,239 Current portion of lease liabilities 27,206 34,021 Current bonds issued 597,580 - Interest on bonds issued 7,612 3,616 Adjusted Working Capital 926,273 928,693 …………………………………………………………………………………………………………………………………………………... Calculation of Free Cash Flows to the Firm: in thousand USD FY2024 FY2025 Net cash generated by operating activities 472,136 241,664 Net cash used in investing activities (112,548) (40,343) Free Cash Flows to the Firm 359,588 201,321 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 38 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Alternative Performance Measures continued The Management believes that these APMs assist in providing additional useful information on the underlying trends, performance and position of the Group. APMs are used by the Management for performance analysis, planning, reporting and incentive setting purposes. The measures are also used in discussions with the investors, investment analyst community and credit rating agencies. APM Calculation Why APM is the most important for management EBITDA Profit from operating activities adding back amortization and depreciation. EBITDA is the main metric used by the management of the Group to measure operating performance. It is also widely used by inves- tors when evaluating businesses, and by rating agencies and cred- itors to evaluate the leverage. EBITDA margin EBITDA divided by revenue during the reported period. EBITDA margin is a metric widely used to measure profitability of Group's operations. Segment EBITDA Segment profit from operating activities adding back amortization and depreciation. EBITDA is the main metric used by management of the Group to measure segment operating performance. Segment EBITDA margin Segment EBITDA divided by segment revenue during the reporting period. Segment EBITDA margin is the metric widely used to measure profitability of Group's segment operations. Investing Cash Flows net of Fixed Assets Invest- ments Net cash used in investing activities adding back pur- chase of property, plant and equipment, and proceeds from disposal of property, plant and equipment. As the Group has grown and developed through acquisitions, this APM helps to monitor the M&A and other investing activities of the Group. Net Fixed Assets Investments Net cash used in investing activities less Investing Cash Flows net of Fixed Assets Investments. The Group is executing a solid investment program, and fixed as- sets investment is an important measure to monitor capital expendi- ture as a part of the execution of investment program. Operating Cash Flows before Working Capital Changes Net cash generated by operating activities less changes in working capital activities, including: • change in trade receivables and other financial assets; • change in prepayments and other current assets; • change in restricted cash balance; • change in taxes recoverable and prepaid; • change in biological assets; • change in inventories; • change in trade accounts payable; and • change in advances from customers and other current liabilities. The Group uses this APM as a pre-working capital measure that reflects Group’s ability to generate cash for investment, debt ser- vicing and distributions to shareholders. Free Cash Flows to the Firm Sum of net cash generated by operating activities and net cash used in investing activities. The Group uses this APM as it reflects the cash generating capa- bility of the Group to repay debt and distribute dividends to share- holders. Commodity Inventories Agricultural inventories, such as corn, wheat, barley, soy- bean, sunflower seed, meal and oil. The Group uses this APM as an additional measure of its liquidity, which the Group uses to provide a supplemental tool to assist man- agement and investors in evaluating current business performance and in calculating credit ratios under certain of the Group’s financ- ing arrangements. Debt Liabilities Sum of bonds issued, current bonds issued, interest on bonds issued, long- term borrowings, current portion of long-term borrowings, short-term borrowings; lease lia- bilities and current portion of lease liabilities. The Group uses this APM, as it is a useful measure of the leverage of the Group, which is widely used by credit investors and rating agencies. Net Debt Debt Liabilities less cash and cash equivalents and cash deposits pledged under credit facilities. The Group uses this APM, as it is a useful measure of the leverage of the Group, which is widely used by credit and equity investors and rating agencies. Adjusted Net Debt Net Debt less commodity inventories. The Group uses this APM as a supplemental measure of the Group’s liquidity , which shows the amount of Debt Liabilities not covered by cash and commodity inventories. Adjusted Working Capital Current assets (excluding cash and cash equivalents, and assets classified as held for sale) less current liabili- ties (excluding short- term borrowings, current portion of long- term borrowings, current portion of lease liabilities, current bonds issued, interest on bonds issued, and lia- bilities associated with assets classified as held for sale). The indicator of working capital is important for the Group, as the Group is involved in trading and processing activities and hold large volumes of inventories on the balance. The Group also invests in business expansion, which needs working capital inves tments to increase efficiency. It is useful for users and investors because it measures both a Group’s efficiency and its short- term financial health. It also helps management to keep a business operating smoothly and meet all its financial obligation within the coming year. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 39 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Sustainability Statement 1 Regulation (EC) No 1907/2006 of the European Parliament and of the Council of 18 December 2006 concerning the Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH) In FY2025, Kernel advanced its sustainability agenda by aligning its Sustainability Statement with the Cor- porate Sustainability Reporting Directive (CSRD) and European Sustainability Reporting Stand- ards (ESRS). This integration reflects a strategic shift toward embedding environmental, social, and governance (ESG) considerations into the Group’s core business model, value chain, and decision-mak- ing processes. Important updates in the FY2025 Sustainability Statement include the consolidated ESG Strategy, which sets forward-looking targets across climate, circular economy, diversity, and community impact by 2030. In FY2025, Kernel also conducted a geo- spatial analysis of our landbank to estimate its prox- imity to protected areas and areas with high biodiver- sity value – an important exercise in preparation for compliance with the EU Deforestation Regulation (EUDR). Furthermore, we screened our whole port- folio of plant protection products and categorized them in line with the REACH 1 criteria of substances of concern and substances of very high concern. The reporting year was marked by significant pro- gress in climate action, human capital development, and stakeholder engagement, despite the ongoing challenges posed by the war in Ukraine. Kernel achieved measurable reductions in greenhouse gas emissions across all scopes, expanded the use of re- newable energy, and deepened its commitment to re- generative agriculture and biodiversity protection. The Group maintained its Carbon Disclosure Pro- ject (CDP) climate rating at level B and became the first in Ukraine’s food industry to commit to the Sci- ence-Based Targets initiative (SBTi). Socially, Kernel reinforced its role as a responsible employer and community partner. It invested in workforce resilience, mental health, and veteran re- integration, while also expanding access to training and career development. Community initiatives reached thousands of beneficiaries, with a focus on healthcare, education, and support for the Ukrainian Armed Forces. Governance practices were strength- ened through enhanced ESG oversight, risk man- agement, and anti-corruption measures, supported by a robust compliance framework and stakeholder engagement mechanisms. Kernel’s first double materiality assessment identi- fied 20 material sustainability topics, guiding the Group’s disclosures and strategic priorities. The Group also reported on EU Taxonomy-aligned activ- ities, with a focus on bioenergy. This progress underscores Kernel’s commitment to long-term value creation through sustainability, resil- ience, and responsible leadership in Ukraine’s agri- cultural sector. SUSTAINABILITY STATEMENT Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 40 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Key highlights in FY2025 Climate action • 220 thousand tCO2e – total Scope 1 GHG emissions, excluding 699 thousand tCO2e of biogenic emissions • 90 thousand tCO2e – total Scope 2 GHG emissions (location-based) • 103 thousand tCO2e – total Scope 2 GHG emissions (market-based) • 1,631 thousand tCO2e – total Scope 3 GHG emissions • Maintained CDP rating (Carbon Disclosure Project) at the level B, making Kernel the only Group in Ukraine with such a rating Energy management • 9,419 TJ – total electricity consumption • 2,146 MJ/t – energy intensity of sunflower seed processing • 66 MJ/t-% – energy intensity of drying grain • 640 MJ/t – energy intensity of harvested grain Waste management • 228 tons – total volume of hazardous waste generated • 26,964 tons – total volume of non-hazardous waste generated Biodiversity management • 208,940 ha – total area of application of biological products accounted • Less than 1% of the landbank is in close proximity to nature-protected areas Employment • 10,760 – total number of employees • 2,293 – total number of new hires • 14.8% – percentage of employee turnover The Excellence Learning Awards, HR and Talent category (Gold) The International CSR Excellence Award UN Global Compact Partnership for Sustainability Award (Gold) HR Brilliance Award Training and career advancement • 216,517 – total number of training hours • 1,894 – total number of employees, receiving regular performance and career reviews Occupational health and safety • 16 – total number of recordable work-related injuries • 0.85 – lost time injury frequency rate Economic performance • USD 4,190 million – Direct economic value generated • USD 3,908 million – Total economic value distributed • Disclosure in line with the EU Taxonomy Support of local communities and society as a whole • USD 30 million – total amount of social spendings, which includes support of the Ukrainian Army, humanitarian aid, and other charity expenses Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 41 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Sustainability at Kernel Sustainability at Kernel is driven by an overarching goal - to feed the growing population while enhancing natural and social capital, particularly in Ukraine. Our management approach towards sustainability is organized around three pillars, namely (1) environmental stewardship, with a material focus on climate actions both in direct operations and throughout the value chain; (2) social responsibility, which gained new levels of prioritization amid the Russian invasion of Ukraine; and (3) governance integrity, commonly referred to as ESG. These principles and approaches are integrated across all of Kernel’s business segments. Our values and purpose that help us manage ESG risks and opportunities in the agriculture sector in Ukraine are as follows: I. Environmental stewardship Low-carbon development: scaling up decarbonization practices across the value chain, from carbon farming and precision agriculture on the field to low-carbon oilseed processing. Biodiversity: promoting soil health and biodiversity through integrated pest management, expansion of cover crop practices, and control over seed quality with own laboratories. II. Social responsibility National security and wellbeing: contributing towards Ukraine’s victory against the Russian invasion through on- going support of the Armed Forces of Ukraine and humanitarian aid. Human capital: proactive expansion of agriculture expertise by attracting and educating students through Open Agro University and other educational and training programs. Diversity, equality and inclusion: integration of veterans back into civilian life, providing them with opportunities for self-realization. III. Governance integrity Sustainable finance: groundwork for systematic attraction of sustainable finance through an evidence-based ap- proach of enhancing natural capital. Ethics and compliance: ensuring transparent business practices through systematic integration of relevant sustain- ability standards. Market leadership: sharing own experience with other key agriculture companies as well as small- and medium-size farmers to improve market maturity and institutional capacity in sustainable and low-carbon development. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 42 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Our ESG Strategy Environmental stewardship Climate change GHG emission reduction  Validate a science-based target (SBTi) for Scope 2 emissions at the Poltava Oil Extraction Plant Regenerative agriculture  Reduce the share of land under plowing from 25% in 2020 to 10% by 2030  Introduce cover crops and siderats in crop rota- tion on 30% of the land previously under winter wheat by 2030 Sustainable agriculture through innovation  Implement a technology management system based on the approaches and results of precision farming polygons on 100% of the land bank by 2030 Energy Renewable energy  Achieve a level of electricity production from own generation using renewable energy sources of at least 50% of the Group’s total electricity con- sumption by its oilseed processing plants by 2030 Biodiversity Pollinators protection  Achieve 100% use of pollinator- safe insecticides during the flowering of crops by 2030 Soil health  Apply biological destructors on at least 50% of the cultivated landbank by 2030 Waste and resource use Packaging  Reach 20% of bottled oil packaged in bottles made with recycled plastic and tethered caps by 2030 1 Social responsibility Own workforce Diversity and inclusion  Increase women’s representation in traditionally male-dominated positions to 15% by 2030  Continuous development of career opportunities and an inclusive working environment for women, youth, veterans, and people with disabilities Talent development  Fill at least 10% of open Group vacancies with graduates of Internship and First job programs by 2030 Communities Resilience and development of local communities  Increase beneficiary participation in the Group’s social programs by 10% across all operational re- gions by 2030 Consumers & end users Engagement with consumers  Launch a new product category — sunflower oil with a reduced carbon footprint across the en- tire value chain  Ensure compliance with the EU Deforestation Regulation (EUDR) Note 1: Unless stated otherwise in the ESG Strategy, the baseline for targets is FY2025 1 20% of bottles with recycled plastic and 20% of bottles with tethered caps Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 43 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements General information Guide to the Sustainability Statement In 2025, Kernel integrated its Sustainability Statement into the Management Report, align- ing the reporting approach with the require- ments of the Corporate Sustainability Report- ing Directive (CSRD) and the European Sus- tainability Reporting Standards (ESRS). The Sustainability Statement forms part of the Management Report and is structured across four key areas: • General information (ESRS 2) • Environmental information (ESRS E1, E2, E4 and E5) • Social information (ESRS S1, S3 and S4) • Governance information (ESRS G1) The sustainability matters covered within these sections are identified from Kernel’s Double Materiality Assessment (DMA), de- scribed in detail on page 47. In preparing the Sustainability Statement, Ker- nel followed the ESRS reporting structure, presenting relevant policies, actions, targets, and metrics in relation to the identified material impacts, risks, and opportunities (IROs). Where required, we have applied the incorpo- ration by reference option: disclosures are presented either within the Sustainability Statement itself or in related sections of the Management Report, as summarized in the ta- ble “List of DRs compiled and list of DRs in- corporated by reference”. Each such case is clearly indicated with a footnote and in-text tag, pointing to the corresponding ESRS Dis- closure Requirement (DR). This approach ensures improved clarity and readability while minimizing unnecessary repetition of infor- mation relating to Kernel’s business model, strategy, value chain, and governance frame- work. Water and marine resources (ESRS E3) and Employees in the value chain (ESRS S2) were assessed as immaterial and are therefore not disclosed in the Sustainability Statement 2025. IRO-2 List of DRs compiled and list of DRs incorporated by reference IR 1 DR Disclosure requirement (DR) description Page General disclosures BP-1 General basis for preparation of the sustainability statement 45 BP-2 Disclosures in relation to specific circumstances 45 ● GOV-1 The role of the administrative, management and supervisory bodies 50-51; 91 ● GOV-2 Information provided to and sustainability matters addressed by the undertaking’s administrative, man- agement and supervisory bodies 50--51; 98 GOV-3 Integration of sustainability-related performance in incentive schemes 51 GOV-4 Statement on due diligence 45; 84 ● GOV-5 Risk management and internal controls over sustainability reporting 45-46 ● SBM-1 Strategy, business model and value chain 7; 15-18; 21-24; 26-28 SBM-2 Interests and views of stakeholders 46-47 SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model 47 IRO-1 Description of the process to identify and assess material impacts, risks and opportunities 48-49 IRO-2 Disclosure Requirements in ESRS covered by the undertaking’s sustainability statement 49 E1 Climate change GOV-3 Integration of sustainability-related performance in incentive schemes 52 E1-1 Transition plan for climate change mitigation 51 SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model 52-54 IRO-1 Description of the processes to identify and assess material climate-related IRO 50 E1-2 Policies related to climate change mitigation and adaptation 50; 87-89 E1-3 Actions and resources related to climate change mitigation and adaptation 53-54 E1-4 Targets related to climate change mitigation and adaptation 54 E1-5 Energy consumption and mix 54-55 E1-6 Gross Scopes 1, 2, 3 and Total GHG emissions 55 E1-8 Internal carbon pricing 57 E2 Pollution IRO-1 Description of the processes to identify and assess material pollution-related IRO 58 E2-1 Policies related to pollution 58; 87-89 E2-2 Actions and resources related to pollution 58-60 E2-3 Targets related to pollution 60 E2-4 Pollution of air, water and soil 61 E2-5 Substances of concern and substances of very high concern 61 Note 1: IR – incorporated by reference. The disclosure requirement marked with a dot [●] is incorporated in the Sustainability Statement, either entirely or partially, by reference to a different section of the Management Report. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 44 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements General information continued E4 Biodiversity and ecosystems SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model 63 IRO-1 Description of processes to identify and assess material biodiversity and ecosystem-related IRO 63-64 E4-2 Policies related to biodiversity and ecosystems 64; 87-89 E4-3 Actions and resources related to biodiversity and ecosystems 64-65 E4-4 Targets related to biodiversity and ecosystems 65 E5 Resource use and circular economy IRO-1 Description of the processes to identify and assess material circular economy-related IRO 66 E5-1 Policies related to resource use and circular economy 66; 87-89 E5-2 Actions and resources related to resource use and circular economy 66-67 E5-3 Targets related to resource use and circular economy 67-68 E5-5 Waste 68 S1 Own Workforce SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model 69 S1-1 Policies related to its own workforce 69-70; 87-89 S1-2 Processes for engaging with own workforce and workers’ representatives about impacts 70 S1-3 Grievance mechanism 81 S1-4 Taking action on material impacts on own workforce, and approaches to managing material risks and pursuing material opportunities related to own workforce, and effectiveness of those actions 70-72 S1-5 Targets related to its own workforce 72 S1-6 Characteristics of the undertaking’s employees 73 S1-9 Diversity metrics 74 S1-10 Adequate wages 74 S1-12 People with disabilities 74 S1-13 Training and skills development metrics 74 S1-14 Health and safety metrics 74 S1-15 Work-life balance metrics 75 S1-17 Incidents, complaints and severe human rights impacts 75 S3 Affected communities SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model 76 S3-1 Policies related to affected communities 76; 87-89 S3-2 Processes for engaging with affected communities about impacts 76-77 S3-3 Processes to remediate negative impacts and channels for affected communities to raise concerns 77; 81 S3-4 Taking action on material impacts on affected communities, and approaches to managing material risks and pursuing material opportunities related to affected communities, and effectiveness of those actions 77-78 S3-5 Targets related to affected communities 78 S4 Consumers and end-users SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model 79 S4-1 Policies related to consumers and end-users 79; 87-89 S4-2 Processes for engaging with consumers and end-users about impacts 79 S4-3 Processes to remediate negative impacts and channels for consumers and end-users to raise concerns 81 S4-4 Taking action on material impacts on consumers and end-users, and approaches to managing material risks and pursuing material opportunities related to consumers, and effectiveness of those actions 79-80 S4-5 Targets related to consumers and end-users 80 G1 Governance ● GOV-1 The role of the administrative, supervisory and management bodies 82 ● G1-1 Business conduct policies and corporate culture 82; 87-89 G1-2 Management of relationships with suppliers 82-83 G1-3 Prevention and detection of corruption and bribery 83 G1-4 Incidents of corruption or bribery 83 G1-6 Payment practices 83 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 45 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements General information continued BP-1 General basis for preparation This Sustainability Statement has been pre- pared on a consolidated basis in accordance with the European Sustainability Reporting Standards (ESRS, EU 2023/2772). It covers Kernel Holding S.A. and all its subsidiaries (collectively referred to as the "Group” or “Ker- nel”) for the period 1 July 2024 to 30 June 2025. The scope of consolidation is consistent with that applied in the Group’s Consolidated Financial Statements. The Sustainability Statement encompasses value chain information across the Group’s di- rect operations, as well as its indirect activities in the upstream and downstream stages. For specific information on the Group’s value chain, please refer to the Business Model sec- tion. The entire value chain was considered during the Double Materiality Assessment (DMA); the detailed procedure and material impacts, risks, and opportunities (IROs) are presented in the Material Impacts, Risks, and Opportunities sub-section (pages 47-49). The Group has omitted information corre- sponding to intellectual property, know-how, or the results of innovation. BP-2 Disclosure in relation to specific circumstances Time horizons In preparing this sustainability statement, the Group has applied the following forward-look- ing time horizons as defined in ESRS 1: • Short-term: 1 year, within the reporting pe- riod • Medium-term: from 1 to 5 years • Long-term: more than 5 years Changes in preparation on the presentation of the Sustainability statement In FY2025, there were no changes made in the preparation and presentation of sustaina- bility information compared to the previous re- porting period. Reporting errors in prior report- ing periods, namely FY2023 and FY2022, were identified and corrected in the GHG emissions (Scope 1, 2, and 3, as well as GHG emission intensity) metrics. Errors were asso- ciated with the ongoing improvements in the accounting system, clarifications of raw data, alignment of relevant conversion factors, and other corrections related to calculations. Disclosures from other legislation or sustainability reporting standards This Sustainability Statement contains infor- mation as per the EU Taxonomy. In the pro- cess of DMA, we took into consideration the overarching principles of the Global Reporting Initiative (GRI). In preparing the E1 Climate Change information, we were guided by the Task Force on Climate-Related Financial Dis- closures (TCFD) framework. Incorporation by reference Kernel has applied the ESRS “Incorporated by reference” approach, placing specific Disclo- sure Requirements (DRs) within the Manage- ment Report. The list of DRs incorporated by reference, along with their placement in this Annual Report, is presented in the table on pages 43-44. Use of phase-in and voluntary provi- sions The Group has elected to apply phase-in pro- visions for SBM-3 (48e), E1-9, E2-6, E4-6, and E5-6 in line with ESRS 1 Appendix C. Data points that are voluntary for reporting have also been omitted. Sources of uncertainty Disclosed metrics that are subject to a high level of measurement uncertainty include Scope 3 emissions. The uncertainty arises be- cause the calculation approach entirely relies on the use of secondary data such as emis- sions factors from DEFRA and CEDA data- bases, as well as spend-based methodolo- gies. These approaches are based on indus- try-average estimates rather than region- or source-specific carbon footprint values, which limits precision and introduces measurement uncertainty. GOV-4 Statement on due diligence We recognize that robust due diligence across all business segments and throughout the value chain is the foundation of responsible business conduct and sustainable develop- ment. As a leading agricultural producer in Ukraine, we are guided by international sus- tainability standards, including the United Na- tions (UN) Guiding Principles on Business and Human Rights. Our due diligence framework is based on systematic risk identification, as- sessment, prevention, and mitigation prac- tices to address actual and potential environ- mental and social impacts within our direct op- erations. We also evaluate our suppliers, in- vestment decisions, and business relation- ships to ensure compliance with environmen- tal regulations, labor rights, and ethical busi- ness practices. In addition, Kernel has suc- cessfully undergone several external Environ- mental and Social due diligence reviews con- ducted by international financial institutions and commercial banks, which inform financing decisions. See additional information on due diligence in Annex 1. GOV-5 Risk management and internal controls over sustainability re- porting Scope, main features, and compo- nents of Risk Management and Inter- nal Control processes As part of the Group’s risk management pro- cess, risk management and internal controls encompass all aspects of annual sustainability reporting. These processes include the identi- fication, assessment, and mitigation of inher- ent material misstatement risks arising, among others, from potential human error or data incompleteness that could impact the ac- curacy of sustainability reporting (see Risks and Uncertainties section of this report). Risk Assessment approach and prior- itization methodology The Group’s risk assessment approach in- volves a systematic evaluation of potential risks based on their likelihood and impact. Sustainability reporting-related risks are incor- porated into the enterprise risk management framework, which prioritizes risks using a risk matrix that categorizes them as high, medium, or low priority and is currently undergoing for- malization. This methodology allows for focus- ing resources on the most significant risks to the sustainability reporting process. Main risks identified and mitigation strategies The sustainability reporting process presents several risks, including incompleteness, er- rors, data inaccuracies, regulatory non-com- pliance, and operational disruptions. To miti- gate these identified risks, internal controls are applied in the reporting streams. Segregation of responsibilities is applied in the reporting process, where separate individuals conduct data collection, validation, and review. A key component of this framework is data verifica- tion, which includes reconciling reported data with source systems and analyzing material differences compared to prior years. To sup- port regulatory compliance, legislative changes and updates are continuously moni- tored to achieve alignment with reporting re- quirements. Given the reliance on key person- nel within the reporting organization, these measures help address risks related to work- force availability and expertise, supporting consistency in disclosures. Integration of findings of Risk Assess- ment and Internal Controls into inter- nal functions and processes As outlined above, the sustainability reporting risks are incorporated into the internal risk management system, and the findings from risk assessments and internal controls are Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 46 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements General information continued integrated into internal functions through reg- ular updates to the policies and procedures. The Group aims to ensure that all departments are aligned with the sustainability reporting objectives and that any identified risks are ad- dressed promptly. The Group also conducts training sessions to keep employees who are involved in the reporting function informed about the latest developments in sustainability reporting. SBM-2 Interests and views of stake- holders Kernel recognizes that its business operations impact various stakeholders, who, in turn, influence and shape how we conduct our busi- ness. Kernel identifies eight stakeholder groups that are subject to inter-influence and ongoing interaction with the Group. These in- fluences and stakeholder categories are out- lined in Kernel’s management vision, as well as through an analysis of stakeholder feed- back dynamics, and are revised during due dil- igence and DMA processes. Our stakeholder interactions are guided by the Stakeholder En- gagement Policy, which aligns with the rele- vant IFC Performance Standards. Stakeholder engagement is a vital part of Ker- nel’s DMA process. The outcomes of this en- gagement shaped the final prioritization of material topics for disclosure, boosting the credibility and transparency of the assess- ment process. Stakeholder views gathered during this process were incorporated into Kernel’s sustainability priorities and consid- ered in the Group’s broader strategy and busi- ness model. More details on stakeholder en- gagement within the DMA framework are pro- vided on pages 48-49. Key interests and methods of engagement with stakeholder groups Employees Interest and key concerns Engagement method • Healthy and safe working conditions • Fair workplace conditions and practices • Competitive salary and career advancement • Professional development opportunities and recognition of results • Equality and diversity • Learning & development programs • Internal communications • Group website & social media • Hotline for submitting compliance-related inquiries • HR Conference & Strategic sessions for each business division IFIs & Banks Interest and key concerns Engagement method • Transparent, accurate, and timely information on financial perfor- mance • Risk control and prevention, compliance with ESG standards, and re- sponsible business conduct • Non-financial performance and sustainable development • Annual and quarterly reports • Group website & social media • One-to-one meetings (online/offline) • Email communication and ESG questionnaires Local communities Interest and key concerns Engagement method • Employment opportunities • Responsible land and resource use • Compliance with national legislation • Support for local farmers (knowledge-sharing, partnership) • Socio-economic development of territories • Timely communication and effective grievance handling • Environmental and social impact assessments • One-to-one meetings (online/offline) • Group website & social media • Hotline for submitting compliance-related inquiries • Printed material distributed among communities National and local government Interest and key concerns Engagement method • Regulatory compliance (national and local) • Socio-economic development of territories • Responsible land and resource use • One-to-one meetings (online/offline) • Group website & social media • Website of the charitable foundation “Together with Kernel” • Local and national media • Hotline for submitting compliance-related inquiries Civil society organizations/NGOs Interest and key concerns Engagement method Environmental NGOs: • Climate change adaptation and mitigation • Risks of water and soil pollution, impact on biodiversity • Timely communication and effective grievance handling Social NGOs: • Compliance with national legislation • Livelihood of local communities • Human rights of employees and local communities • Equal opportunities and diversity • Timely communication and effective grievance handling • One-to-one meetings (online/offline) • Group website & social media • Annual reports • Hotline for submitting compliance-related inquiries Academics and analysts Interest and key concerns Engagement method • Efficient handling of questions, feedback, or research-related inquiries • Group website & social media • One-to-one meetings (online/offline) • Email communication Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 47 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements General information continued Material Impacts, Risks and Opportunities (IROs) SBM-3 Results of double materiality assess- ment (DMA) As the foundation for this sustainability state- ment, Kernel conducted its first double mate- riality assessment (DMA) in alignment with the Corporate Sustainability Reporting Directive (CSRD) and guidance from the European Fi- nancial Reporting Advisory Group (EFRAG). The double materiality principle requires re- porting on topics deemed material from at least one of the following perspectives: • Impact materiality: The actual or potential impacts of Kernel’s operations on people and the environment. • Financial materiality: Sustainability-related risks and opportunities that may influence Kernel’s financial performance In FY2025, we identified the following sustain- ability topics as material to our business model, operations, and business relationships across the value chain: Within these areas, 20 sustainability sub-top- ics were identified and assessed for their im- pact, financial, or dual materiality. These are visually presented in the materiality matrix on this page. Each material subtopic is defined by specific material impact, risks, and opportunities (IROs), which serve as the basis for Kernel’s topical disclosures. Comprehensive infor- mation on the DMA methodology and topic- specific IROs is provided in the IRO-1, IRO-2, and SBM-3 sections for each relevant topical standard. No entity-specific topics have been identified for FY2025. The IROs identified through the DMA are out- lined in detail within each topical chapter. They highlight where along the value chain these IROs materialize and over which time horizons they are relevant, directly connecting them to Kernel’s strategy and business model. Customers Interest and key concerns Engagement method • Food safety and quality of products • Transparency and traceability of product information • Compliance with certification standards • Timely communication and effective grievance handling • Group website & social media • Group’s brand names • Brand exhibitions and specialized events • Annual reports • Hotline for submitting compliance-related inquiries • Customer research and brand health tracking Suppliers Interest and key concerns Engagement method • Fair market competition • Transparent procurement • Ethical business conduct • Compliance with agreements and delivery of commitments • Supply Chain Sustainability Program • One-to-one meetings (online/offline) • Group website & social media Climate Change Pollution Biodiversity and Ecosystems Resource Use and Circular Economy Own Workforce Affected Communities Consumers and end-users Governance S1 S3 S4 G1 E1 E2 E4 E5 ………………………………………………………………………………………………………………………………………………………………………. Kernel’s materiality matrix Environment E1 Climate Change 1 Climate change adaptation 2 Climate change mitigation 3 Energy E2 Pollution 4 Pollution of air 5 Pollution of water 6 Pollution of soil 7 Substances of concern 8 Substances of very high concern 9 Pollution of living organisms 10 Microplastics E3 Water and Marine Resources 11 Water 12 Marine resources E4 Biodiversity and Ecosystems 13 Direct impact drivers of biodiversity loss 14 Impacts on the state of species 15 Impacts on the extent & condition of ecosys- tems 16 Impact & dependencies on ecosystem ser- vices E5 Resource Use and Circular Economy 17 Resource inflows 18 Resource outflows 19 Waste Social S1 Own Workforce 20 Working conditions 21 Equal treatment and opportunities for all 22 Other work-related rights S2 Workers in the Value Chain 23 Working conditions 24 Equal treatment and opportunities for all 25 Other work-related rights S3 Affected Communities 26 Communities‘ economic, social, and cultural rights 27 Communities‘ civil and political rights 28 Rights of indigenous peoples S4 Consumers and end-users 29 Information-related impacts for consumers 30 Personal safety of consumers 31 Social inclusion of consumers Governance G1 Governance 32 Business conduct 33 Corruption and bribery Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 48 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements General information continued IRO-1; IRO-2 Description of the process to identify and assess material impacts, risks, and opportunities Kernel conducted a double materiality assess- ment in line with the principles of the European Sustainability Reporting Standards (ESRS), evaluating sustainability matters from both im- pact and financial materiality perspectives. The determination of material sustainability matters was based on a quantitative assess- ment of a previously identified list of IROs. This approach involved prioritizing IROs based on the factors of severity and likelihood, followed by calculating their materiality score, and consists of the following six steps: Step 1. Identification of impacts, risks and opportunities The process of identifying IROs began with the long list of relevant sustainability topics outlined in ESRS 1, Application Requirement (AR) 16. Building on previous reporting efforts, we refined our understanding of the business model, activities, and value chain to capture the broader implications of our operations across sustainability topics. This included mapping the Kernel’s supply chain and identi- fying relevant internal and external stakehold- ers throughout the upstream and downstream value chain. Screening of our operations and supply chain provided the basis for defining IROs across different stages of production and business relationships. The assessment first addressed the Group’s impacts, both positive and negative, across environmental, social, and governance dimen- sions. It then focused on identifying risks and opportunities, particularly those linked to the identified impacts, supported by a review of the Group’s Risk Management System. Rele- vant IROs were analyzed and validated through close collaboration between the sus- tainability team and internal subject-matter ex- perts. We considered various internal and external sources of information to form the list of rele- vant IROs and to inform our analysis, including industry-specific ESG benchmarks, such as GRI, internal analyses, stakeholder expecta- tions, regulatory requirements, and Kernel’s strategy. Step 2. Impact materiality assessment The impact materiality assessment evaluated actual or potential, positive or negative im- pacts on people and the environment. This as- sessment considered the location of the im- pact across the value chain (upstream, own operations, and downstream) and the ex- pected timeframe of occurrence: short-term (up to 1 year), medium-term (1–5 years), and long-term (beyond 5 years). We developed a calculation methodology aligned with ESRS-proposed criteria (Section 3.4). Actual impacts were assessed based on severity factors such as scale, scope, and ir- remediability, while potential impacts were evaluated using severity and likelihood. Each factor was assigned a score on a scale from 1 to 4, representing limited to strategic impacts of the Group on environmental, social, or gov- ernance matters. Please refer to the Impact Assessment table for more details on the methodology. The raw materiality score for potential impacts ranged from 1 to 16 and was normalized to a standardized scale of 1 to 4 to ensure con- sistent interpretation and comparability. Fol- lowing consultations with internal stakehold- ers, a threshold of 1.3 for the normalized ma- teriality score was adopted to classify IRO as material. In line with ESRS 1 for potential neg- ative impacts on human rights, the severity of the impact was given more weight than likeli- hood, reflecting the critical importance of hu- man rights considerations. Step. 3 Financial materiality assessment The financial materiality assessment involved the evaluation of identified risks and opportu- nities that affect, or are expected to affect, the Group’s financial position, financial perfor- mance, cash flows, access to finance, or cost of capital. These effects may manifest as neg- ative or positive deviations over the short-, medium-, or long-term across different parts of the value chain. We assessed each identified risk and opportunity based on the potential magnitude (severity) of financial effect and the likelihood of occurrence (ESRS 1, Section 3.5). Risks and opportunities were evaluated ac- cording to their nature, specifically whether they directly affected the Group’s financial health or influenced its reputation: • Financial risks and opportunities were measured using absolute EBITDA thresh- olds aligned with the Group’s defined risk appetite. • Reputational risks and opportunities were assessed based on the level of media expo- sure and stakeholders’ perception. For consistency, each risk and opportunity DMA Assumptions Value chain Kernel’s DMA considers the value chain per- spective through the assessment of IROs arising from our own operations, upstream suppliers of oilseeds and grains, as well as trade partners and customers in the down- stream value chain. The details on Kernel’s value chain are outlined in the Business Model section. Stakeholder engagement The perspective of affected stakeholders and the users of the Sustainability State- ment was incorporated into the assessment through direct engagement with stakehold- ers (see page 46 on Stakeholder engage- ment), as well as by proxy through the knowledge of our internal subject matter ex- perts. These experts, representing different divisions of the Group, engage with affected stakeholders as part of their core responsi- bilities and stay informed on the latest devel- opments across relevant ESG areas. Sustainability due diligence In addition to stakeholder engagement, our DMA was informed by our Social and Envi- ronmental Due Diligence and the Enterprise Risk Management process (see pages 45- 46). Impact assessment criteria Actual Potential Score Negative impact Positive impact Negative impact Positive impact Scale Evaluates the intensity of the impact on people or the environment 1-4 Scope Measures how widespread the impact is on people or the environment 1-4 Irremediability Assesses the extent to which a negative impact can be remediated Irrelevant Assesses the extent to which a negative impact can be remediated Irrelevant 1-4 Likelihood Irrelevant Irrelevant Probability of occurrence 1-4 Materiality calculation Severity 1 Severity 2 Severity¹ x likelihood Severity² x likelihood Normalized 1-4 Note 1: Severity of negative impact is defined as scale, scope and irremediability. Note 2: Severity of positive impacts is defined as scale and scope Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 49 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements General information continued was assigned a score on a scale from 1 to 4, representing severity and likelihood ranging from ‘limited’ to ‘strategic’ in significance to the Group’s financial position. In line with the over- all evaluation methodology, raw materiality scores for potential risks and opportunities were normalized to ensure comparability. A materiality threshold of 1.3 was established, with any IRO scoring at or above this threshold considered material. Step 4. Consolidation of results The results of the impact and financial materi- ality assessment were consolidated to obtain an overview of Kernel’s impacts, risks, and op- portunities mapped within the longlist of sus- tainability matters. A sustainable matter was defined as a material if included at least one material IRO at every level of aggregation, i.e., subtopic and topic. After identifying material sustainability mat- ters, the corresponding data points from the EFRAG data point list were determined for dis- closure using the ESRS decision tree. For fur- ther detail, refer to “List of DRs compiled and list of DRs incorporated by reference” on pages 43-44 and Annex 2 “List of data points that derive from other EU legislation”. The Water and Marine Resources topic (ESRS E3) was considered immaterial to Ker- nel’s operations within environmental topics, as water is not a key resource across any of our business segments. Currently, less than 1% of our land bank is irrigated for seed pro- duction. In the oilseed processing segment, water is used primarily for technical purposes, such as steam generation and domestic needs, both of which require insignificant vol- umes. Although the IROs related to ESRS E3 did not meet our materiality thresholds, Kernel acknowledges its responsibility to monitor and manage water-related subjects. These topics continue to be addressed through our existing governance structures, policies, and opera- tional practices. Step 5. Stakeholder validation and man- agement validation Stakeholder engagement was leveraged to validate the outcomes of the materiality as- sessment, ensuring accuracy, completeness, and relevance. A broad group of internal and external stakeholders, including IFIs and banks, suppliers, trade partners and custom- ers, civil societies and business associations, government representatives and policymak- ers, as well as the Group’s departments of sustainable development, CSR, trading and product quality, investor and public relations, compliance, HR and internal audit - actively participated in a dialogue regarding the Group’s identified material topics. Stakeholders' views on material topics were taken into account through email. Each stake- holder received a list of potentially material topics and was asked to indicate which topics they considered material, along with justifica- tions. Insights gained from stakeholders were analyzed and considered in the finalization of material matters, addressing potential gaps and reinforcing the prioritization of IROs. Where necessary, the status of topics under review was reconsidered either by: • Integrating previously overlooked IROs; • Recalibrating severity and likelihood scores of already identified IROs. The validated results were presented to the leadership team for final endorsement. The Group's Board of Directors, together with the Sustainability Department, oversees and ap- proves the material sustainability topics and DMA methodology, ensuring alignment with corporate objectives and stakeholder expecta- tions. Step 6. Monitoring and periodic review Kernel implements a structured approach for monitoring and periodic review of its sustaina- bility topics. The monitoring process includes tracking changes within the regulatory land- scape, industry trends, and emerging new IROs that may affect the Group or its stake- holders, as well as maintaining consistent dialogue with stakeholders to ensure their perspectives are integrated into the DMA pro- cess. A re-assessment of double materiality is per- formed on an annual basis. Previously identi- fied outcomes may remain valid if there is suf- ficient evidence to confirm their relevance at the time of reporting. In the event of major events, such as significant regulatory changes or the establishment of new business relation- ships, an immediate review of sustainability topics will be triggered. The Group’s Sustain- ability Department oversees the monitoring process and conducts the annual review in collaboration with the Financial Reporting, Ac- counting, and Control Departments. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 50 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Environmental information E1 Climate change In this section: • Climate change adaptation • Climate change mitigation • Energy E1.IRO-1 Climate change-related impacts, risks and opportunities Impacts, risks, and opportunities related to cli- mate change mitigation, adaptation, and en- ergy were identified through Kernel’s DMA, in- formed by our annual climate risk analysis conducted in alignment with the TCFD frame- work. This analysis, which covers both physi- cal and transition-related risks and opportuni- ties, is presented in detail in the sub- section “Climate Risks and Opportunities” on page 51. For further details on the methodological ap- proach applied under the DMA, see pages 48- 49. The table below summarizes the material IROs identified for E1 Climate change, includ- ing their location in the value chain and the timeframe over which associated risks, oppor- tunities, and potential impacts, both positive and negative, may materialize. MDR-P; E1-2 Policies Kernel recognizes climate actions and the broader climate corporate governance as one of the most material aspects of the Group’s ESG agenda. Principles of traceable and effi- cient climate mitigation and climate adaptation practices across the whole value chain are an- chored by the Environmental Protection policy and reflected in the Sustainable Development and CSR policy. We expect our suppliers to uphold the same level of climate-related re- sponsibility as outlined in our Supplier Code of Conduct. See Annex 3 – Key Policies and Procedures for a detailed description of all Kernel policies. GOV-1; GOV-2; E1.GOV-3 Climate corporate governance Board oversight of climate corporate gov- ernance Kernel’s Sustainability Committee of the Board of Directors is the body responsible for (1) identifying, prioritizing, and advising the Board on the Group’s strategic activities in the areas of decarbonization, climate-related business opportunities, development of envi- ronmental, social and human capital, and sus- tainability governance (hereinafter – “ESG”) and sustainable finance; (2) critically review- ing and considering the ESG Strategy, which will incorporate SBTi aligned climate targets and decarbonization pathway; (3) ensuring the implementation of the ESG Strategy across business operations; (4) connecting ESG and climate corporate agendas with Kernel’s busi- ness strategy, business objectives and capital allocation decision. The Sustainability Committee consists of at least three members, appointed by the Board of Directors upon the proposal of the Nomina- tion and Remuneration Committee. The Chair of the Committee appoints a secretary, who is usually a sustainability manager within the Group. For this reason, the Sustainability Committee serves as an effective link between the Board of Directors and the Executive Man- agement Team. The Sustainability Committee meets at least twice a year. The purpose of such meetings is the following: Environmental Material Impacts, Risks and Opportunities Value chain Time horizon 1 Sustainability matter IRO IRO nature Description Upstream Own operations Downstream E1 Climate change Climate change adaptation Positive impact Actual Enhancing climate resilience by implementing regenerative agricul- tural practices that reduce soil erosion and improve water retention capacity. ● - Risk Financial Acute physical climate risks: Crop yield losses resulting from extreme weather events. ● ● S Risk Financial Chronic physical climate risk: Losses of productive land due to the shifts in climatic zones ● ● L Risk Financial Higher expenditure on crop protection due to increased vulnerability to pests and diseases amid chronic climate change. ● ● M Climate change mitigation Negative impact Actual Generation of greenhouse gas (GHG) emissions (Scope 1,2,3). ● ● - Positive impact Actual Reducing GHG emissions and promoting carbon sequestration through improved agricultural and land management practices. ● ● - Risk Financial Climate transitional risks: Increasing spending on material assets (OPEX) as a result of new regulatory frameworks ● L Opportunity Financial Creation of new revenue streams from low-carbon practices and com- modities, including carbon certificates, price premiums, and access to green financial instruments. ● ● S Energy Positive impact Actual Generation and supply of renewable energy to the grid supports local communities and contributes to greenhouse gas (GHG) emissions re- duction ● ● - Risk Financial Increased spending on electricity as a result of new domestic regula- tory frameworks, i.e., UA ETS ● L Opportunity Financial Provision of feedstock and production of biomethane and liquid biofu- els in response to the growing demand under the REPowerEU frame- work. ● M Opportunity Financial Reduced operating expenses and enhanced energy self-sufficiency through the adoption of bioenergy solutions ● S Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 51 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Environmental information continued • update on priority business opportunities re- lated to sustainability function and climate change • when required, review of changes in rele- vant policies and procedures • when required, review and approval of stra- tegic targets associated with decarboniza- tion and sustainable development. Regarding remuneration, services provided by the Directors in their capacity as members and the chairwoman of the Sustainability Commit- tee include oversight of the identification and implementation of climate-related business opportunities, which is considered in their fixed fees. The Audit Committee critically reviews and prioritizes physical and transition climate risks as part of its responsibilities to assist the Board of Directors in delivering its risk man- agement responsibilities by providing a de- scription of risks specific to Kernel, overseeing the adequacy and effectiveness of Kernel’s risk management system, and reviewing the Group’s policies on risk assessment and risk management. Management’s role in climate corporate governance Kernel aims to integrate ESG and climate-re- lated corporate agendas into its overall busi- ness strategy and operations. The Executive Management Team is actively engaged in the implementation of ESG and climate action practices and initiatives within their respective functions, which are considered a priority at a specific time. Kernel plans and prioritizes such initiatives based on its vision of the Group's role and the agricultural sector's overall contri- bution to achieving the goals of the Paris Agreement, as well as its position within the international climate arena. We develop our vi- sion based on our understanding of global dy- namics in the areas of decarbonization and carbon markets, complemented by continuous dialogue with our key trade partners and major global agriculture commodity traders. The Chief Executive Officer plays a crucial role in overseeing the integration of ESG and climate-related corporate agendas into busi- ness operations. The CEO provides a critical review and feedback on the development of Kernel's ESG and climate corporate strategy, including GHG emission reduction targets, ap- proaches to the development of the sustaina- bility and climate corporate strategy across operations, as well as engagement in relevant business opportunities related to decarboniza- tion. The HR Director provides overall support to initiatives related to low-carbon development. This includes the development of climate- related KPIs for the Executive Management Team, which are then cascaded across each corporate function. The head of the HR De- partment is also responsible for communi- cating the importance and benefits of sustain- ability practices and climate actions within the Group, as well as supporting their implemen- tation from a behavioral perspective. Kernel’s Head of Sustainability is in direct subordina- tion to the Head of the HR department. The Head of Sustainability is responsible for lead- ing the development and improvement of Ker- nel's sustainability and climate corporate func- tion. The Risk Committee of the Executive Man- agement Team is responsible for identifying, assessing, managing, and controlling key risks, including climate-related risks. In FY2025, Kernel has formalized an internal strategic target for the executive management by 2028 related to climate change, namely “Ensuring the implementation of the Group's low-carbon development and climate resili- ence projects”. This target is further cascaded across relevant departments through annual KPIs. The results of the annual evaluation of progress towards KPIs and the overall perfor- mance of employees directly impact remuner- ation decisions, specifically the review of wages and the size of bonuses. E1-1 Transition plan for climate change mitigation In 2023, Kernel finalized the "Climate corpo- rate governance and low-carbon pathway" project in partnership with EBRD and EY. The project covered an assessment of climate-re- lated risks and opportunities (aligned with TCFD recommendations), a gap analysis of climate governance, and a feasibility review of mitigation and adaptation measures. Based on these results, Kernel developed a compre- hensive Program of Activities that sets out or- ganizational and investment measures to strengthen climate governance and enhance performance. The Program spans key areas including agribusiness, production, energy, carbon offsets, supply chain, GHG account- ing, risk management, strategy, governance, and sustainable finance. The Program was re- viewed by the Sustainability committee, priori- tizing actions and reflecting them in respective KPIs for executive and operational managers. It now serves as the cornerstone of Kernel’s long-term emission-reduction strategy, aligned with SBTi FLAG guidance and sup- porting the Group’s planned climate transition pathway. However, due to the ongoing Russian invasion of Ukraine and related uncertainties, the Group has not yet adopted its transition plan for climate mitigation, particularly in relation to setting GHG emissions reduction targets. The timing of adoption remains contingent on ex- ternal wartime developments. Nevertheless, the Group has established its ESG strategy and continues to advance initiatives on broader sustainability topics beyond carbon, ensuring progress in areas such as sustaina- ble production, resource efficiency, social re- sponsibility, and governance. E1.SBM-3 Climate risks and opportunities Approach to climate risk identification and management Kernel conducted a comprehensive resilience analysis to assess how climate risks could be reflected in the enterprise value over the short- , medium-, and long-term time horizons. • Short-term (up to 1 year): Evaluation of ex- posure to climate impact in the short-term perspective aligns with the annual opera- tional business planning, reflecting the dy- namics of the commodities market. In Farm- ing, Kernel continuously monitors and ana- lyzes climate parameters throughout the crop cycle (land preparation, fertilization, plantation, plant protection, and harvest- ing). Key indicators include precipitation, temperature, atmospheric pressure, sum of active temperatures, and soil moisture re- serve (SMR), with data sourced from the Group’s own meteorological stations. Ker- nel also uses the normalized difference veg- etation index, also known as NDVI, from satellite databases to assess and predict yields by estimating the density of green coverage on land. • Medium-term (1 to 5 years): Scientific mod- eling indicates a gradual shift in Ukraine’s natural zones (woodlands, forest-steppe, steppe) northwestward over the next dec- ade. For this horizon, Kernel aligns climate risk assessment with 5-year financial mod- eling. Scenarios account for acute climate events, which might have a significant neg- ative impact on harvest. Kernel's assess- ment of medium-term climate risks shows that acute climate events have the most im- pact on oilseed crops, namely sunflower. The Group already has experience in adapt- ing to these risks through changes in the ge- ographic location of the land bank to more suitable areas. • Long-term (5 to 10 years): Kernel relies on the Coupled Model Intercomparison Pro- ject models (CMIP6) to evaluate long-term climate dynamics (reference point: 2051– 2055). While the Group does not undertake business planning over such extended hori- zons, these projections inform future deci- sion-making, particularly in relation to M&A opportunities. The overall approach to evaluating climate Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 52 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Environmental information continued risks and their financial impacts is built on the climate change information provided by the Regional Climate Models, specifically CMIP6 Projections using the SSP 2.6-4.5 scenario, (referred to as “Net Zero 2050” or “hard”); and the SSP 8.5 scenario (referred to as “Nation- ally Determined Contributions” or “soft”). This allows us to understand the dynamics of cli- mate change impact across Kernel's landbank in the long-term perspective. Relevant parameters of these scenarios are used to stress-test Kernel's financial model, allowing the Group to evaluate exposure to long-term climate change and quantify the monetary impact, particularly on EBITDA. Transitional climate risks are also included in the model, reflecting potential additional ex- penditures under both Ukrainian and Euro- pean carbon regulations. The interconnection between climate, physi- cal, and transitional risks is linked to the as- sumption that SSP 2.6-4.5 scenarios would imply that carbon regulations will be tightened significantly. It will significantly impact the Group’s performance, but the Group will be less vulnerable to physical risks. In contrast, the SSP 8.5 scenario suggests that carbon regulations will be tightened moderately, with a soft impact on the Group’s performance. Still, in turn, the Group will be more exposed to physical risks. Monitoring of physical chronic climate risks is based on the Group's practical observations and analysis of available agrometeorological research on changes in Ukraine's climate zones and yield dynamics. To that end, Ker- nel's business analysts conduct a regular analysis of harvest results from both Kernel and other agricultural companies in Ukraine, comparing these indicators across geographic regions. This enables the identification of cli- mate patterns and tendencies across the land bank, which are used to inform long-term stra- tegic decisions on asset allocation. Such deci- sions are made at the Executive Management Team level or the level of the Board of Direc- tors if the monetary implication of risk exceeds the established substantial strategic impact threshold. The risk of acute climatic events resulting in decreased yields is a basic risk for the agricul- ture business. Within Kernel's risk manage- ment framework, this risk is reflected as “Weak harvest in Ukraine”, which is typically included in the Group’s top ten risks. Likewise, the Group's financial modeling provides for conservative basic assumptions of reduced yields due to the impacts of acute climate 1 Food and Agriculture Organization of the United Nations, GAEZ Data Portal impacts. In addition, acute climate physical risks also affect Kernel's infrastructure since extreme weather conditions would impact farming business across the whole country (impact on Kernel's supply chain and trading operations), leading to decreased capacity op- erations of the Group's silos and oilseed pro- cessing plants. Kernel's sustainability function undertakes the identification of climate transition risks through the ongoing monitoring of develop- ments in domestic and EU carbon regulations. Material transitional risks are evaluated in terms of their monetary impact, together with financial and business analytics. The evalua- tion of climate transitional risks is based on an analysis of the Network for Greening the Fi- nancial System (NGFS) scenarios of carbon prices within the EU ETS and in Ukraine. The analysis of these scenarios and the financial implications of climate transition risks, as well as information on key drivers of these risks (i.e., developments in EU and domestic cli- mate regulations), are updated annually. Assessment of material climate-related risks and anticipated financial effects Chronic physical risks For Kernel's operations, chronic physical cli- mate risks are relevant in both long-term stra- tegic decisions on asset location and the im- pact on yields of key crops. Analysis of the overall dynamics in the climate system across Ukraine's territory demonstrates a gradual shift in the boundaries of natural zones (wood- lands, forest-steppe, steppe) towards the northwest, reducing the extent of suitable ar- eas and affecting yields. Lower yields trans- late into potential EBITDA losses not only for the Farming segment but also indirectly for Oilseed Processing, Infrastructure and Trad- ing. To estimate potential long-term decrease in yields, we apply projections of Global Agro- Ecological Zoning for Ukraine, prepared by the Food and Agriculture Organization (FAO) 1 .These projections result from climate scenario Ensemble (average of 5 climatic models) for RCP 2.6 and RCP 8.5 for the pe- riod 2040-2070. Acute physical risks We evaluate acute physical risks using the Regional Climate Model (RCM) of climate dy- namics in Ukraine. The RCM collects data on single levels from numerous experiments, models, domains, resolutions, ensemble members, time frequencies, and periods com- puted over several regional domains all over the World, particularly in the CMIP6 of the Coordinated Regional Climate Downscaling Experiment (CORDEX) framework. This anal- ysis indicates that the frequency of acute events such as droughts is expected to rise in the northern parts of Kernel’s land bank under the SSP 8.5 scenario in the long term. To estimate the potential financial impact of acute climate risks, we use the 2024 impacts of heatwaves and drought during the pollina- tion period on harvest as a reference point and translate them into potential losses in EBITDA for Farming, Oilseed processing, Infrastruc- ture and Trading. Kernel also plans a more in- depth analysis of historical harvest perfor- mance and its correlation with extreme weather events, enabling the assessment to be further tailored to on-the-ground data. Transition risk: emerging carbon regula- tion in Ukraine (carbon tax and Emission Trading Scheme) Ukraine’s carbon tax applies to Kernel’s com- bined heat and power plants that generate electricity from sunflower husk, a by-product of the oilseed crushing process recognized un- der Annex IX.A of the EU RED II Directive as an advanced biofuel feedstock. The nature of these risks lies in the fact that the EU’s posi- tion on the combustion of biomass and pro- duction of advanced biofuels contradicts Ukraine's regulation on Monitoring, Verifica- tion, and Reporting (MRV), considering GHG emissions of biomass combustion to be zero. Ukraine's carbon tax increased from 10 UAH to 30 UAH per ton of CO 2 in 2021. Although the rate remained unchanged in FY2025, we anticipate that it would grow in the medium- term perspective to become more aligned with the average price of a ton of CO 2 in the EU (these expectations are based on Ukraine's commitments under the EU Association Agreement and its candidacy to the EU, as well as Ukraine's possible response to EU CBAM requirements). Kernel evaluates the risk of the expected growth in carbon tax over the following years, based on the average car- bon tax value in EU member countries (EUR 20-120 per tCO 2 ), which would result in signif- icant annual expenditures. Regarding Ukraine's national emission trading scheme (UA ETS), the key risk for Kernel is the significant increase in electricity price, which would include the cost of carbon, when UA ETS is finalized and launched. We use the NGFS (Network for Greening the Financial System) climate modeling of the carbon price dynamics in Ukraine to estimate potential fi- nancial impacts. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 53 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Environmental information continued The financial impact of this transitional climate risk is estimated as a range of combined addi- tional expenditure stemming from increased carbon tax and electricity price by 2030, where the minimum figure is the projections under the SSP 8.5 and the maximum figure – under the SSP 2.6-4.5 scenario. As of FY2025, the carbon price in Ukraine is projected to be EUR 1.1 per tCO 2 under the SSP 8.5 scenario and increase up to EUR 231.2 per tCO 2 under the SSP 2.6-4.5 scenario. Transition risk: emerging carbon regula- tion in EU (increasing cost of fertilizers) EU's ‘Fit for 55’ package (under which the EU seeks to cut its emissions by at least 55% be- fore 2030) includes provisions on the ETS, namely the target to reduce emissions by 61% before 2030 and to reduce the number of free allowances by 4.2% each year. GHG emis- sions from the production of nitric acid, ammo- nia, and hydrogen are covered by the EU ETS. Considering that nitric acid, ammonia, and hy- drogen are intermediates in the production of NPK fertilizers, it is expected that the price of EU-sourced fertilizers will increase following the implementation of the Fit for 55 provisions. The financial impact of this transitional climate risk is estimated to be a range of additional ex- penditures stemming from the increased cost of N-fertilizers, with the minimum figure pro- jected under the SSP 8.5 scenario and the maximum figure under the SSP 2.6-4.5 sce- nario. As of FY2025, if produced in the EU, the price of fertilizers would reflect the price of EU allowances on GHG emissions, which are pro- jected to increase up to EUR 203.7/tCO 2 un- der the SSP 8.5 scenario, and up to EUR 283.7/tCO 2 under the SSP 2.6-4.5 scenario by 2030 (according to NGFS climate data projec- tions). In the case of domestically produced fertilizers, their price would account for a pro- jected carbon price in Ukraine as indicated above. Assessment of material climate-related op- portunities Bioenergy. Kernel explores opportunities in the production of biofuels, namely biomethane produced from plant-based feedstocks such as silage, corn, or crop residue. Demand for such energy sources is increasing in both Ukraine and the EU, supported by the REPow- erEU initiative. Recent developments in Ukrainian legislation further support this op- portunity by allowing biomethane injection into the national gas transportation system and by establishing a renewable gas guarantees of origin (RGGO) registry for biomethane pro- ducers. Diversification of financial assets with sus- tainability- and climate-linked finance. We aim to effectively access markets of sustaina- bility- and climate-linked finance, both in terms of receiving specialized interest rates on loans (linked to specific covenants) and project fi- nance. International carbon markets. Since 2024, Kernel has been in the process of developing grounds for accessing voluntary carbon mar- kets, namely through the methodology VM0042 that quantifies the greenhouse gas (GHG) emission reductions and soil organic carbon (SOC) removals resulting from the adoption of improved agricultural land man- agement, as well as intergovernmental carbon market mechanisms provided by Article 6.2 and Article 6.4 of the Paris Agreement. Explor- ing carbon offset markets is closely tied to in- depth analysis of global market incentives for decarbonizing the supply chains of agricultural commodities, fostering relevant dialogue with reputable international organizations, and ex- changing knowledge with key trading partners. Efficiency improvement through carbon farming practices. The opportunity lies around the system of farming practices that promote the accumulation of soil organic car- bon, reduction of GHG emissions from tillage and nitrification, and improving soil health and biodiversity. These practices are commonly referred to as regenerative, or carbon farming, which is one of the key pillars of the Group’s corporate climate strategy. We believe that this represents a long-term direction of devel- opment, which is expected to have a visible impact on capitalization. Over the last several years, this subject has evolved from purely theoretical discussion to practical considera- tion during operational planning and testing. MDR-A; E1-3 Actions and resources Kernel’s decarbonization strategy focuses on both its Farming and Oilseed Processing seg- ments. Adoption of regenerative agriculture prac- tices Material decarbonization actions are concen- trated in the Farming segment, as crop pro- duction accounts for the majority of Kernel’s GHG emissions. The emission reductions are achieved through carbon farming practices, also known as regenerative agriculture, in- cluding reduced tillage, the use of nitrification inhibitors, and the introduction of cover crops into crop rotations. According to prior estima- tions, such practices can potentially have the following emission reduction capacity: (1) nitri- fication inhibitors up to 10% reduction, (2) cover crops up to 31% reduction, and (3) re- duced tillage up to 85% reduction. More than 90% of Kernel’s land bank is already cultivated using reduced tillage technology. Implementation of precision farming tech- nologies Emission reduction efforts go hand in hand with enhancing operational efficiency. Kernel has been advancing the principles of precision farming, and since 2023, has introduced zonal management within its fields. By identifying homogeneous productivity zones and tailoring agricultural practices to each, the Group is able to optimize tillage and input application rates. These decisions are informed by de- tailed soil characteristics, climate, and terrain data, agrochemical analysis, and other varia- bles, ensuring both greater efficiency and re- duced environmental impact. Scaling renewable energy use In the Oilseed Processing segment, the Group seeks to leverage its capacity for green elec- tricity production from biomass (sunflower seed husk) that previously was sold to the na- tional energy grid in full volume. At the Poltava OEP, this electricity is now used to power bot- tled oil production, significantly reducing the production’s carbon footprint – marking an- other step toward embedding sustainable practices into its production cycle. In the re- porting period, Poltava OEP also completed external verification confirming the direct con- sumption of green electricity from its CHP. Collaboration plays a key role in the Group’s decarbonization efforts. In FY2025, Kernel was selected as a beneficiary of the Jumbo Impact Fund, an initiative launched by our cli- ent, Jumbo Supermarkten, to reduce GHG emissions in supply chains through co-funded projects. Under this program, Kernel received a co-financing of USD 328 thousand to imple- ment a low-carbon sunflower seed processing project for bottled oil production at Poltava OEP. Building on this success, Kernel intends to scale the Poltava OEP model across its other oilseed processing plants, with the po- tential to reduce up to 50% of Scope 2 emis- sions through direct consumption of green electricity from CHPs. The remaining energy consumption, related to Scope 2 electricity us- age, can potentially be offset by allocating self-generated renewable electricity for inter- nal operations or sourcing external low-carbon electricity through market instruments such as Corporate Power Purchase Agreements (PPAs). MDR-T; E1-4 Targets Kernel has set climate-related targets that in- tegrate decarbonization, sustainable agricul- ture, and the expansion of renewable energy. At the Poltava OEP, we are advancing the validation of a science-based target (SBTi) for Scope 2 emissions, ensuring our reduc- tion pathway is consistent with global climate Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 54 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Environmental information continued goals. In agriculture, we are committed to regenera- tive practices that improve soil fertility, pre- serve biodiversity, and reduce greenhouse gas emissions: we aim to reduce the share of land under plowing from 25% in 2020 to 10% by 2030, while introducing cover crops and siderats on 30% of land previously dedicated to winter wheat. To strengthen resource efficiency and support innovation, we aim to implement a technology manage- ment system based on precision farming polygons across 100% of our land bank by 2030, enabling data-driven decisions that op- timize yields and minimize environmental im- pacts. Complementing these actions, we aim to have at least 50% of the electricity used by our assets come from our own renewable generation by 2030, advancing our transition to low-carbon energy, reducing reliance on fossil fuels, and lowering operational risks linked to energy volatility. With these measures, we are dedicated to delivering measurable climate benefits while securing long-term competitiveness and sustainability of the Group. Metrics E1-5 Energy consumption and mix Energy consumption terajoules FY2023 FY2024 FY2025 Non-renewable fuel consumed 2,381.2 1,895.0 1,593.6 Natural gas 1,194.6 717.0 489.6 Oilseed Processing 112.0 212.2 251.5 Infrastructure and Trading 1,031.8 486.3 234.4 Farming 50.8 18.5 3.7 Other - 0.0 0.0 Diesel 1,113.1 1,099.6 1,042.2 Oilseed Processing 3.6 9.1 13.7 Infrastructure and Trading 50.3 28.8 20.6 Farming 1,051.2 1,056.6 1,002.7 Other 7.9 5.2 5.2 Petroleum 37.9 43.4 41.0 Oilseed Processing 0.6 1.0 1.1 Infrastructure and Trading 4.2 5.8 5.2 Farming 32.4 29.2 25.8 Other 0.7 7.4 8.8 LNG 35.6 35.0 20.8 Oilseed Processing 0.2 0.2 0.2 Infrastructure and Trading 1.7 2.0 1.4 Farming 33.7 32.2 18.9 Other - 0.5 0.3 Renewable fuel consumed (sunflower seed husk) 5,189.2 7,028.0 7,113.2 Purchased electricity 581.1 628.4 471.8 Oilseed Processing 413.5 457.4 325.3 Infrastructure and Trading 127.3 128.2 110.8 Farming 38.0 40.4 34.0 Other 2.4 2.4 1.7 Heating 414.5 766.6 534.4 Oilseed Processing 0.0 0.0 0 Infrastructure and Trading 0.0 1.5 1.1 Farming 0.0 0.0 0.0 Other 414.5 765.1 533.2 Electricity from own generation 203,9 232,3 530,3 Electricity sold to the grid 631.7 1,094.3 826.2 Total energy consumption 8,138.2 9,456.0 9,418.6 Oilseed processing 5,291.3 6,846.0 7,409.1 Infrastructure and Trading 1,215.3 652.6 375.2 Farming 1,206.1 1,176.9 1,085.1 Other 425.6 780.5 549.2 Note 1: Any discrepancies between data in this and previous reports (FY2024 and FY2023) are associated with further improvements in the accounting system, clarifications of raw data, alignment of relevant conversion factors and other corrections. Energy intensity indicators 1 megajoules FY2023 FY2024 FY2025 Energy consumed per ton of sunflower seed crushed 2,058.7 2,279.6 2,145.6 Energy consumed per ton-% of grain dried 64.3 64.5 66.3 Energy consumed per ton of harvested grain 632.2 629.5 640.0 Energy intensity based on net revenue, per USD million 2.4 2.6 2.3 Note 1: Any discrepancies between data in this and previous reports (FY2024 and FY2023) are associated with further improvements in the accounting system, clarifications of raw data, alignment of relevant conversion factors and other corrections. The revenue figure used is USD 4,115 million (in FY2024 – USD 3,581 million), consistent with the revenue reported in Kernel's Consolidated Statement of Profit or Loss in its consolidated financial statements. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 55 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Environmental information continued E1-6 Scope 1, Scope 2 and Scope 3 greenhouse gas (GHG) emissions Key GHG emission indicators 1 thousand tCO2e FY2023 FY2024 FY2025 Scope 1 271.7 237.2 220.0 by GHG CO 2 128.2 88.5 50.2 CH 4 23.8 23.9 18.5 N 2 O 119.7 124.8 151.3 by business segment Oilseed Processing 6.6 12.7 15.2 Infrastructure and Trading 62.2 30.0 15.1 Farming 202.3 193.6 188.5 Fuel use 91.7 90.0 84.7 Fertilizers application 109.5 114.6 141.4 Changes in stock of soil carbon - 25.5 - 37.9 - 58.4 Cattle methane from enteric fermentation 26.7 26.9 20.8 Other 0.7 1.0 1.1 Biogenic (combustion of sunflower husk) 509.8 690.5 698.9 Scope 2 (Location based) 92.5 123.5 89.7 Scope 2 (Market based) 132.1 152.8 102.9 Scope 3 2,141.5 2,508.3 1,631.6 Cat.1. Purchased goods and services 605.1 922.3 864.6 Cat.2. Capital goods 4.3 8.6 7.3 Cat.3. Fuel- and energy-related activities (not incl.in S.1-2) 59.7 57.2 50.1 Cat.4. Upstream transportation and distribution 375.2 265.1 150.5 Cat.5. Waste generated in operations 4.5 6.6 4.0 Cat.9. Downstream transportation and distribution 1,088.5 1,219.6 523.0 Cat.10. Processing of sold products 3.5 28.1 31.9 Cat.12. End-of-life treatment of sold products 0.8 0.7 0.2 Note 1: Any discrepancies between data in this and previous reports (FY2024 and FY2023) are associated with further improvements in the accounting system, clari- fications of raw data, alignment of relevant conversion factors and other corrections. Scope 3 GHG emissions of Avere Commodities SA 1 thousand tCO2e FY2023 FY2024 FY2025 Scope 3 741.8 777.1 2,161.4 Cat.1. Purchased goods and services 657.7 735.9 2,078.7 Cat.9. Downstream transportation and distribution 58.3 29.8 67.6 Cat.10. Processing of sold products 25.8 11.5 15.1 Note 1: In line with the consolidation principles of the ESRS framework, the Group estimated GHG emissions of Avere Commodities SA fo r the first time in the reporting period. Material GHG emissions are considered to be associated with the trading activities, namely the following Scope 3 categories: Category 1 “ Purchased goods and services”, Category 9 “Downstream transportation and distribution”, and Category 10 ‘Processing of sold products” . Estimations were made using proxy emission factors from sources recognized by the GHG Protocol, such as Ecoinvent and CEDA by Watershed databases, as well as Kernel’s data. The Group seeks to develop this accounting in future reporting periods Key GHG emissions intensity indicators (Scope 1&2) 1 FY2023 FY2024 FY2025 GHG emissions per volume of harvested crop, kg CO2e/ t of yields Corn 37.4 60.3 63.2 Sunflower 158.3 144.4 140.9 Wheat 39.7 47.9 53.5 Rapeseed 374.9 535.1 276.7 Soybean 94.7 66.8 101.9 GHG emissions per area of sowed crop, kg CO2e/ ha Corn 419.8 484.2 604.1 Sunflower 472.7 419.0 411.7 Wheat 288.3 309.1 331.4 Rapeseed 1,010.0 1,258.5 768.1 Soybean 271.1 145.6 263.1 GHG emissions per sunflower seeds processed, kg CO2e/ t of seeds 28.2 27.0 30.8 GHG emissions per net revenue (location-based), kg CO2e/USD million 111.7 107.6 89.0 GHG emissions per net revenue (market-based), kg CO2e/USD million 127.2 118.8 95.8 Note 1: Any discrepancies between data in this and previous reports (FY2024 and FY2023) are associated with further improvements in the accounting system, clari- fications of raw data, alignment of relevant conversion factors and other corrections. The revenue figure used is USD 4,115 million (in FY2024 - USD 3,581 million), consistent with the revenue reported in Kernel's Consolidated Statement of Profit or Loss in its consolidated financial statements. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 56 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Environmental information continued E1-8 Internal carbon pricing For internal carbon pricing, Kernel uses two sources of indications, namely (1) the Ukrain- ian carbon tax and (2) actual and projected prices of allowances within the EU Emission Trading Scheme (EU ETS). Projected prices of EU ETS allowances are estimated in line with the scenarios of climate impact dynamics provided by the Network of Central Banks and Supervisors for Greening the Financial Sys- tem (NGFS). As of the end of FY2025, the ap- plied price of carbon was estimated at USD 203.7, which is the projected price of one EU ETS carbon allowance by 2030 under the NGFS ‘Nationally Determined Contributions’ (soft) scenario of climate impact dynamics. Under the NGFS ‘Net Zero 2050’ (hard) sce- nario of climate impact dynamics, the price of an allowance is projected to increase up to USD 283.7 by 2030. The Group applies these carbon price indications in the annual assess- ment of climate transitional risks, specifically to conduct driver analysis of climate change factors on the Group's EBITDA stress testing, as well as to estimate the financial impact of climate-related business opportunities. Re- sults of such assessments are used in the de- cision-making regarding risk management and appropriate response to arising opportu- nities. The Group’s internal carbon pricing ap- proach covers 100% of gross Scope 1 and Scope 2 emissions. MDR-M Climate change accounting methodology Energy consumption and mix For the calculation of energy consumption, the Group consolidated data from its business segments and subsidiaries, primarily including information from supplier invoices and meter readings. Total energy consumption for own operations consists of fuel usage at the as- sets, fuel consumption in both owned and leased agriculture machinery and vehicles, and the use of purchased, self-generated en- ergy and electricity sold to the grid (including heating). Self-generated electricity is reported as “Renewable fuel consumption”, as this is electricity generated from biomass (sunflower seed husk). Each business segment and sub- sidiary in the Group reports energy consump- tion data by energy type. Categories of con- sumed fuel include natural gas, diesel, petro- leum, and LNG. Scope 1, Scope 2, and Scope 3 greenhouse gas (GHG) emissions Kernel accounts for GHG emissions from its operational activities in Ukraine, adhering to the IPCC Guidelines for National Greenhouse Gas Inventories and Greenhouse Gas Proto- col Guidance. Scope 1 emissions include direct GHG emissions associated with the Group's opera- tions of fossil fuel stationary and mobile com- bustion, cattle farming, farmland cultivation (soil carbon stock change), and fertilizer appli- cations. The Group’s total biogenic GHG emissions, generated from the combustion of sunflower seed husk and changes in organic carbon stocks, are reported separately. Emis- sions associated with farming operations are reported in the financial year, when the agri- cultural products were harvested, using data on mineral and organic fertilizers applied dur- ing the growth period in crops. We continue improving prototype operational accounting of GHG emissions from farming operations across key crops (winter wheat, corn, sunflower, winter rapeseed, and soy- bean) and individual fields (Kernel’s whole landbank, comprising approximately 5 thou- sand fields). The main purpose of such an ap- proach is to reflect that the landbank is not ho- mogeneous in terms of soil characteristics, ag- roclimatic conditions, and, therefore, agricul- tural technology and application rates, which in turn are tailored to crop rotation. For that reason, it’s correct to calculate the carbon footprint of farming operations (kgCO 2 /t of yield and kgCO 2 /ha) for each field rather than on average for the whole landbank. This ap- proach also enables the demonstration of an- nual carbon removals (shown as negative val- ues) resulting from changes in tillage prac- tices, such as shifting from conventional to re- duced tillage, sowing cover crops, and man- aging crop residue. We are working to auto- mate such accounting by integrating the meth- odology into existing ERP systems and ensur- ing traceability of the carbon footprint of each batch of grain (originating from a particular field) across the value chain. For these pur- poses, we seek to ensure minimization of data uncertainty: calculations of changes in soil carbon due to tillage are performed using “measure and model” and “measure and re- measure” approaches (aligned with the Veri- fied Carbon Standard methodology, VM0042) that account for the availability of laboratory agrochemical data on soil organic carbon. This approach will enable us to monitor the field-related carbon footprint of our commodi- ties (in kgCO 2 e/t of yield) and operations (in kgCO 2 e/ha) from sowing to harvest. By doing so, the Group can better evaluate the overall potential for decarbonizing farming opera- tions, prioritize geographic locations and in- tensity of low-carbon practices, and achieve GHG emissions reductions with greater mon- etary efficacy. Scope 2 (location-based) emissions refer to GHG emissions generated from energy (elec- tricity and heating) that the Group purchases from the national grid. The average specific emission factor for electricity production in Ukraine is calculated as the ratio of total emis- sions from electricity production in Ukraine (source: National Inventory Report to UNFCCC) to energy production itself (source: Ministry of Energy and Coal Mining). Scope 2 (market-based) emissions refer to GHG emissions from energy (electricity and heating) consumed, calculated based on emission factors from specific electricity con- tracts. Carbon intensity of heating, both loca- tion and market-based approach, is the same due to a vertically integrated market and heat- ing monopoly supply. Scope 3. To calculate Scope 3 emissions, Kernel applies the methodology provided by the GHG Protocol Corporate Value Chain (Scope 3) Accounting and Reporting Stand- ard. We use secondary data to calculate 100% of our Scope 3 emissions across all 15 cate- gories: • Purchased goods and services: This cate- gory includes three material types of pur- chased products: (1) grains and oilseeds, (2) agricultural machinery, and (3) fertiliz- ers. For the purchased grains, the account- ing approach lies in the application of car- bon intensity factors of Kernel's own crops to the volumes of the purchased grains. For the purchased agricultural machinery, a spend-based method was used, where emission factors were calculated based on the carbon intensity of the net revenue of machinery producers (material producers included CNH Industrial, John Deere, MAN, and Palfinger). For nitrogen fertilizers pur- chased by Kernel, emissions were calcu- lated based on nitrogen content and sector- average emission factors (kg CO2e/kg N). To calculate this category of emissions for Avere Commodities SA, the global market activity emissions factors sourced from Ecoinvent database were applied for the fol- lowing commodities: palm oil, palm meal, rapeseed oil, rapeseed meal, soy oil and soy meal. For corn, sunflower, wheat, rape- seed, soybean, sunflower oil, and sunflower meal Kernel’s operational emission inten- sity data for respective years were applied. • Capital goods: Kernel accounted for the emissions associated with the production of metal and concrete, used for the construc- tion of assets. The Group applied material use emission factors for metal and concrete from the UK Department of Environment, Food and Rural Affairs (DEFRA). • Fuel-and-energy-related activities (not in- cluded in Scope 1 or 2): To calculate this category of emissions, Kernel used primary data on energy consumption and applied Well-to-tank indicators (Activity A) from DEFRA; transmission and distribution losses data for Ukraine (Activity C); as well Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 57 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Environmental information continued as average heat rate of local thermal power plants (Activity B) to calculate emissions across three types of activities: Activity A (23,686.2 tons CO2e), Activity B (14,938.8 tons CO2e), Activity C (11,507.5 tons CO2e). • Upstream transportation and distribution: This category includes emissions from the transportation of purchased goods and in- ternal logistics (i.e., transportation of grains from fields to silos and from silos to termi- nals). We applied the Rail transportation and Truck transportation emission factors from CEDA 2024 by Watershed. • Waste generation in services: For this cate- gory, Kernel used primary data on waste generation and approaches to waste utiliza- tion, including treatment of wastewater dis- charged to WWTPs. The Group applied the Waste disposal emission factors from DEFRA. • Business travel: This category of emissions is not material in comparison to the total vol- ume of Scope 3 GHG emissions. We evalu- ated this category of emissions and con- cluded that it remains immaterial for Kernel operations (less than 1 tCO 2 e). • Employee commuting: This category of emissions is not material in comparison to the total volume of Scope 3 GHG emis- sions. We evaluated this category of emis- sions and concluded that it remains imma- terial for Kernel operations (less than 1 tCO 2 e). • Upstream leased assets: Kernel does not have leased assets within its operations. • Downstream transportation and distribution: This category includes the emissions asso- ciated with the marine freight of sold prod- ucts (grain and oil) – from the combustion of fuel by ships, mostly Panamax class. Emis- sion factors for water transportation, sourced from CEDA by Watershed data- base, were applied. The same approach was used for calculating this category of emissions for Avere Commodities S.A. Processing of sold products: This category includes emissions associated with the re- fining of sunflower oil. Unrefined sunflower oil purchased from Kernel typically under- goes a refining process at the buyer's facili- ties. To calculate such emissions, the Group used the average electricity effi- ciency factor for its own refining process and applied grid emission factors for each country where sunflower oil was exported (The IFI Dataset of Default Grid Factors). The same approach was applied for calcu- lating this category of emissions for Avere Commodities SA Avere, specifically for sun- flower oil, palm oil, rapeseed oil, and soy oil. • Use of sold products: Kernel sells final prod- ucts, including grains, sunflower oil, and an- imal meal. In case the sold products are used in the energy sector, the sunflower oil- related biodiesel component of fuel is con- sidered zero-carbon. • End-of-life treatment of sold products: this category includes the emissions associated with the treatment of the waste sold. Kernel used primary data on the waste sold and its utilization approaches. The relevant Waste disposal emission factors from DEFRA were applied. However, this category of emissions is not material in comparison to the total volume of Scope 3 emissions. • Downstream leased assets: This category of emissions is not relevant to Kernel's busi- ness, as the Group does not provide leased assets. • Franchises: This category of emissions is not relevant to Kernel's business as the Group neither acts as an investor nor does it have shares in emission-related portfolios. • Investments: This category of emissions is not relevant to Kernel's business as the Group neither acts as an investor nor does it have shares in emission-related portfolios. No significant events or changes in circum- stances related to GHG emissions occurred in the reporting period. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 58 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Environmental information continued E2 Pollution In this section: • Pollution of air, water and soil • Substances of concern and very high con- cern E2.IRO-1 Pollution-related impacts, risks and opportunities Agricultural and processing activities have a negative environmental footprint due to their interaction with natural systems and the use of resources. Kernel pays close attention to these impacts, recognizing pollution-related effects arising across its core operations. Pol- lution-related impacts have been identified through an impact screening process. As part of this process, we mapped our business seg- ments - farming, oilseed processing, infra- structure, and trading, analyzing where inter- actions with nature occur and where emis- sions to air, water, and soil are generated. The assessment also covered the identification of transitional and physical risks and opportuni- ties associated with these impacts. To ensure a comprehensive understanding of our pollu- tion-related IROs, we consulted internal sub- ject matter experts, including environmental and operational teams. Although affected communities were not directly involved in the pollution materiality assessment, their per- spectives were indirectly considered through a review of environmental complaints received via the grievance mechanism. These engage- ments helped validate and refine the identifi- cation of relevant IROs. For further details on the methodological ap- proach applied under the DMA, see pages 48- 49. The table below summarizes the material IROs identified for E2 Pollution, including their location in the value chain and the timeframe over which associated risks, opportunities, and potential impacts, both positive and nega- tive, may materialize. MDR-P; E2-1 Policies Kernel recognizes the importance of address- ing environmental pollution and is committed to protecting air, clean water, and healthy soils through the application of best practices and technical solutions. These ambitions are re- flected in our Environmental Protection policy. The policy places a strong emphasis on pre- venting and mitigating environmental impacts. We systematically monitor key environmental indicators related to pollution to ensure the re- sponsible use of natural resources and contin- uous improvement in environmental perfor- mance. To prevent incidents and emergen- cies, we conduct regular technical inspections of our equipment and implement preventive measures. In the event of an industrial or nat- ural emergency, Kernel acts immediately to stop any processes causing significant envi- ronmental impact, contain pollution, and ad- dress the consequences. Our response measures are designed to minimize harm to both people and the environment through rapid reaction and remediation efforts. We ex- pect our suppliers to uphold the same level of environmental responsibility as outlined in our Supplier Code of Conduct. See Annex 3 – Key Policies and Procedures for a detailed description of all Kernel policies. MDR-A; E2-2 Actions and resources Our commitment remains focused on prevent- ing and reducing emissions using best prac- tices and technical solutions. Monitoring of environmental impacts and ecological compliance Our management approach towards regula- tion of the impacts of our operations on the en- vironment is built on two pillars, namely (1) continuous monitoring of key environmental performance indicators to be aligned with per- mit requirements and to pass environmental inspections successfully, and (2) the use of environmental impact assessment (EIA) and strategic environmental assessment (SEA) procedures in line with national legisla- tion, for planned activities that pose a high risk of significant environmental impacts. Mechanisms of environmental monitoring are practically implemented through a group-wide environmental management system (EMS), which is certified with the ISO 140001 Environmental Material Impacts, Risks and Opportunities Value chain Time horizon 1 Sustainability matter IRO IRO nature Description Upstream Own operations Downstream E2 Pollution Pollution of air Negative impact Actual Direct emissions of air pollutants result from combustion-powered ma- chinery, oilseed processing and grain handling, fertilizer and pesticide ap- plication, and other agricultural operations. ● - Pollution of water Negative impact Actual Agricultural operations can degrade water quality through discharges and chemical runoff from fertilizer and pesticide applications, as well as from oilseed processing. This can result in nutrient loading, leading to eutroph- ication and oxygen depletion in water bodies. ● - Positive impact Actual Adoption of regenerative agricultural practices improves soil structure and water infiltration and retention, thus preventing chemical runoff and nitro- gen leaching. ● - Pollution of soil Negative impact Actual Direct soil pollution caused by improper use of chemicals like fertilizers and pesticides can negatively impact on the soil environment. ● - Substances of concern (SoC) and Substances of very high concern (SVHC) Negative impact Actual The use of plant protection products containing SoCs and SVHCs might negatively impact human health and the environment. ● - Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 59 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Environmental information continued “Environmental management” standard 1 . Re- sponsibility for performing environmental monitoring and ensuring compliance with rel- evant legislation lies with the assets-based team of environmental specialists (11 full-time employees). Due to the nature of our business operations, we are required to obtain permits for air emis- sions, water withdrawal, and wastewater dis- charge, each of which specifies emission and discharge limits in accordance with applicable local regulations. The process of obtaining permits is performed both by Kernel’s team of environmental specialists and external con- tractors. In FY2025, Kernel’s assets obtained a total of 14 new permits, including three air emission permits and 11 water withdrawal per- mits. Moreover, over the reporting period, Ker- nel has been working on completing the envi- ronmental impact assessment (EIA) process for six projects. In line with permit obligations, we have devel- oped monitoring programs to control the envi- ronmental quality of our operations. These in- clude analyzing air, soil, and water quality and assessing levels of noise and vibration pollu- tion. The state ecological inspectorate did not perform environmental compliance inspec- tions on our assets in FY2025, since inspec- tions are forbidden during martial law. Im- portantly, we considered and successfully re- solved all 7 complaints regarding Kernel’s op- erations from local citizens. In FY2025, we spent a total of USD 341 thousand on measures associated with the mitigation of en- vironmental impacts and environmental pro- tection. Control of air pollution In the Kernel’s operations, air pollution asso- ciated with oilseed processing and grain han- dling is addressed through a series of techno- logical initiatives. Particulate matter and NO ₂ emissions, re- sulting from sunflower husk combustion, are managed using technological emission control systems. Our oilseed processing plants oper- ate 11 electrostatic precipitators (ESPs) to re- move particulate matter (PM) from boiler flue gases. These highly efficient filtration devices (95-98%) use electric energy to generate an electrostatic charge that captures fine parti- cles. Additionally, the boilers at two oilseed extrac- tion plants (OEPs) are equipped with DeNO₂ systems designed to reduce nitrogen dioxide (NO₂) emissions. These systems work through a chemical reaction between nitrogen 1 Certification ISO 14001 covers key trading Group Kernel-Trade, six oil crushing plants, two farming clusters, fifteen silos and one trading terminal oxides and a reagent, producing molecular ni- trogen (N₂) and water. Depending on parame- ters, this process allows for the reduction of nitrogen oxide emissions by 30-75%. Dust emissions associated with grain and oilseed handling are primarily managed through engineering solutions designed to minimize the release of particulate matter into the atmosphere. This includes the use of en- closed unloading stations, covered conveyor lines, and ship-loading equipment equipped with integrated dust control features. Where complete prevention is not feasible, emissions are treated using specialized equipment. No- tably, dust from grain handling operations is effectively controlled through the use of cy- clone filters, which are installed at all silos and transshipment terminals. Hexane emissions, which are linked to its use as a solvent in edible oil extraction, are carefully regulated and minimized throughout its transportation, storage, and application to ensure both resource efficiency and opera- tional safety. The solvent operates in a closed- loop system, enabling it to be reused across multiple extraction cycles, thereby optimizing efficiency and minimizing environmental im- pact. In FY2025, Kernel’s hexane management at oilseed processing plants was focused on three key areas: • Improving use efficiency: Enhancing cool- ing systems to enable more effective con- densation of hexane vapors, thereby in- creasing solvent recovery and reducing losses. • Early detection and monitoring: Installing hexane analyzers to enable timely leak de- tection and continuous monitoring of emis- sions. • Maintenance: Conducting regular technical maintenance to prevent uncontrolled hex- ane losses and ensure system integrity. All equipment in contact with hexane at Ker- nel’s plants complies with the EU ATEX Di- rective (2014/34/EU ‘Equipment for potentially explosive atmosphere’). Emissions of ozone-depleting substances, primarily refrigerants, are linked to the opera- tion of industrial cooling equipment at two oil extraction plants and within the animal hus- bandry division. Maintenance and monitoring of these systems are performed by an external organization. In FY2025, no refrigerant leaks were detected. In FY2025, Kernel paid a total of USD 505 thousand in environmental tax, of which USD 368 thousand for CO2 emissions and USD 51 thousand for air-polluting emissions from sta- tionary sources. Control of water pollution At Kernel, we are committed to responsible water pollution management and minimizing the environmental impact of our operations. All wastewater generated during our processing activities is treated before being discharged into water bodies, in full compliance with na- tional regulations. Water management at oilseed processing plants includes the implementation of full-cy- cle water treatment systems in four OEPs. These systems provide biological, physical, and chemical purification of wastewater, en- suring effective treatment before discharge. In FY2025, a total of 229.9 megaliters of wastewater were purified at our facilities, with 139.3 megaliters undergoing physical-chemi- cal and biological treatment, and 90.6 megali- ters treated using dissolved air flotation (DAF) technology. In case an oilseed processing plant is con- nected to a municipal wastewater treatment plant (WWTP), wastewater is pre-treated on- site to meet the requirements set by WWTP and is directed to proper external treatment. Regulatory compliance and quality man- agement of treated wastewater are moni- tored by our laboratories, which analyze water samples in line with the Ukrainian national reg- ulation on maximum permissible discharges of pollutants. This regulation defines acceptable limits for various contaminants and is outlined in our “Special Water Use” permits. Such permits limit the volumes of withdrawn water and/or the volumes and quality of efflu- ents based on surveys that define hydrological conditions, baseline water quality, and the as- similation capacity of a water body. The per- mitting authority uses information on water use within a watershed or aquifer to set permit conditions in a way that balances the interests of all users and keeps cumulative pollution lev- els within the national water quality standards. The regulatory requirements were the only cri- teria for setting permit conditions that define the quality of our effluents. Parameters of wastewater, controlled during laboratory testing, include eight substances as well as biological oxygen demand (BOD₅) and chemical oxygen demand (COD). In FY2025, there were no incidents of non-compliance with the quality requirements of wastewater quality. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 60 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Environmental information continued Preventing agricultural runoff is a focus area in Kernel’s efforts to protect the water en- vironment. We implement strict measures to minimize the risk of water pollution associated with farming activities, the most significant area of potential impact. Specifically, we en- sure the precise application of fertilizers and pesticides, which allows us to control the risk of their runoff into water bodies. In addition, we do not implement agricultural and manure management activities within buffer zones that safeguard surface water resources. Monitoring of soil pollution In the Farming segment, Kernel prioritizes soil health and pollution prevention through preci- sion agriculture and responsible nutrient man- agement. Since 2024, we have been develop- ing soil health management plans for each farm cluster under ISCC certification. These plans include integrating bioinsecticides and biofungicides, improving spraying technolo- gies to minimize ecosystem exposure, and ap- plying degraders and soil remediation tech- niques. For non-agricultural soils, monitoring of non-fertile bulk soils is conducted strictly in line with legislative requirements. Control of substances of concern (SoC) and substances of very high concern (SVHC) In FY2025, Kernel conducted a screening of plant protection products (PPPs) used in the 1 Criteria laid down in Article 57 and is identified in accordance with Article 59(1) of Regulation (EC) No 1907/2006 of the European Parliament and of the Council (35); is classified in Part 3 of Annex VI to Regulation (EC) No 1272/2008 of the European Parliament and of the Council ( 36 ) in one of the following hazard classes or hazard categories: carcinogenicity categories 1 and 2; germ cell mutagenicity categories 1 and 2; reproductive toxicity categories 1 and 2; endocrine disruption for human health; endocrine disruption for the environment; Persistent, Mobile and Toxic or Very Persistent, Very Mobile properties; Persistent, Bioaccumulative and Toxic or Very Persistent, Very Bioaccumulative properties; 2 Criteria laid down in Article 57 of Regulation (EC) No 1907/2006 (REACH) and were identified in accordance with Article 59(1) of that Regulation. Group’s farming operations against the criteria of substances of concern 1 (SoC) and sub- stances of very high concern 2 (SVHC) as part of the broader analysis of our compliance with EU requirements on PPPs. As a result of the screening, the Group identified in its PPPs portfolio 52 products that contain active ingre- dients classified as substances of concern, and 14 products that contain substances of very high concern. MDR-T Targets At present, Kernel has not established quanti- tative sustainability targets related to pollution management. We recognize the importance of setting outcome-oriented goals and are as- sessing the feasibility of defining such targets in the coming years. In the meantime, we track the effectiveness of our policies and actions through the operation of our EMS, which ensures compliance with environmental permits and the ISO 14001 reg- ulatory requirements. Effectiveness is evalu- ated based on the occurrence of incidents with ecological consequences, alongside regular monitoring of pollution emissions. Our defined ambition is to maintain full regulatory compli- ance and to continuously improve our environ- mental performance by minimizing pollution risks. ………………………………………………………………………………………………………………………………………….………..…………………………………………………………………………..… Scheme of Kernel’s water management cycle at oil seed extraction plants Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 61 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Environmental information continued Metrics E2 -4 P ollution of air, water and soil Pollution of air thousand tons FY2023 FY2024 FY2025 Carbon monoxide 0.67 0.92 0.92 Oilseed Processing 0.53 0.83 0.84 Infrastructure and Trading 0.12 0.06 0.063 Farming 0.017 0.024 0.015 Nitrogen oxides 0.42 0.84 0.49 Oilseed Processing 0.35 0.49 0.45 Infrastructure and Trading 0.06 0.332 0.03 Farming 0.007 0.016 0.006 Sulphur oxides 0.05 0.08 0.08 Oilseed Processing 0.04 0.07 0.07 Infrastructure and Trading 0.01 0.01 0.002 Farming 0.0003 0.0001 0.0027 Solid substances 1.26 1.22 0.30 Oilseed Processing 0.6 0.7 0.1 Infrastructure and Trading 0.63 0.40 0.13 Farming 0.08 0.09 0.06 Pollution of water tons FY2023 FY2024 FY2025 Weighing agents 1.1 0.9 11.4 Chlorides 15.4 21.5 32.7 Sulphates 37.3 38.2 53.4 Fats - - - Dry residue (mineralization) 129.7 122.7 174.3 Other substances 3.5 3.9 5.1 Note 1 : The reported values refer to pollutants present in the treated wastewater discharged into groundwater bodies exclusively for the Bandurka Oilseed extraction Plant E2 -5 Substances of concern and Substances of very high concern Substances of concern and Substances of very high concern (SoC/SVHC) Main hazard class, tons 1 SoC/SVHC FY2025 Carc. 1B SVHC - Carc. 2 SoC 21.0 Repr. 1A SVHC - Repr. 1B SVHC 13.9 Repr. 2 SoC 360.0 Muta. 1B SVHC 3.9 Muta. 2 SoC - PMT SoC 2.8 Note 1 : Carc. - carcinogenicity categories Repr. -reproductive toxicity categories Muta. - germ cell mutagenicity categories PMT - Persistent. Bioaccumulative and Toxic Kernel’s specific metrics Key environmental monitoring indicators in FY2025 Scope of monitoring # of checks # of sites monitored # of samples taken Air quality 87 212 1,861 Conditions of the emissions permit 15 95 1113 Conditions of EIA 32 15 422 Areas at the borders with SPA 40 102 326 Water quality 38 87 241 Ground water 29 84 191 Surface water 9 3 50 Soil quality 22 103 106 Areas of waste storage 11 86 85 Areas at the borders with SPA 11 17 21 Noise pollution 28 34 245 Vibration pollution 11 22 47 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 62 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Environmental information continued MDR-M Pollution accounting methodology Pollution of air, water and soil When assessing air pollution from processing plants, emissions from husk and natural gas combustion in boiler units, as well as gas com- bustion in grain dryers, are considered. Addi- tionally, particulate matter emissions from technological processes unrelated to fuel combustion are also taken into account. Emis- sions from the infrastructure and farming seg- ment include pollutants generated during fuel combustion in small installations (such as boil- ers, grain dryers, and generators), as well as particulate matter and other pollutants typical of auxiliary and related processes. An external contractor develops substantiating documents for the company that include descriptions of technological processes, identification of sources, and calculations of pollutant emis- sions. Based on specific emission factors, the company’s environmental specialists perform quarterly calculations of actual pollutant emis- sions into the atmosphere and corresponding environmental tax. Wastewater discharges into surface water bodies are performed in accordance with a special water use permit, which specifies the discharge volumes and maximum permissible concentrations of pollutants. Each quarter, the company’s environmental specialist submits wastewater samples to an accredited independent laboratory for analy- sis. The volume of discharged wastewater is recorded using a flow meter. Based on the laboratory results and measured wastewater volumes, the environmental spe- cialist calculates the amount of pollutants in the discharged wastewater and the corre- sponding environmental tax. Substances of concern and substances of very high concern Volumes of applied plant protection products are obtained from Kernel’s database, which consolidates the factual situation on the ground based on accounting write-offs. The write-off of activity data is conducted based on the actual records of all agricultural operations made by agronomists for each field through- out the cultivation season in the operational online system (Online Job Order Book). Agronomists also reflect actual data on field activities on the online application ‘Mobile Agronomist’ (MAG), which interlinks with the Online Job Order Book. When conducting screening analysis of the PPPs portfolio against the criteria of substances of concern and substances of very high concern, we as- signed respective classification in the data- base, allowing us to extract data automati- cally. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 63 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Environmental information continued E4 Biodiversity and ecosystems In this section: • Direct impact drivers of biodiversity loss • Impacts on the state of species • Impacts on the extent and condition of eco- systems • Impacts and dependencies on ecosystem services E4.SBM-3 Impacts, risks and opportunities and their interaction with strategy and business model Among Kernel’s business segments, Farming operations are considered as those that both depend on the ecosystem services and may impact biodiversity-sensitive areas. To esti- mate the potential impacts on biodiversity- sensitive areas, in FY2025, Kernel conducted a comprehensive analysis of its entire land- bank (358 thousand ha of cultivated land) to identify spatial overlaps with protected areas. Every field was visually compared against the protected area boundaries obtained from free access at the World Database on Protected Areas (WDPA) 1 using geometric intersection analysis in QGIS 2 platform. To better contex- tualize the area's ecology, biomes and biore- gions were also examined using the Terres- trial Ecoregions of the World (TEOW) 3 . In ad- dition, we similarly screened our landbank against polygons of wetlands of international importance obtained from the Global Wet- lands Database level 3 (GLWD) 4 and the Ramsar list. As a result of this analysis, it was identified that 905 fields out of approximately 5 thou- sand fields demonstrate an average-weighted level of intersection with protected areas, namely the Emerald Network, of 5.7%, which accounts for a total of 3,424 ha (less than 1% of the landbank). Nevertheless, agricultural operations on these fields are legal and are regulated by land lease agreements, which are registered in the State Land Cadastre of Ukraine. We are also compliant with the rele- vant national legislation on protected areas, namely the Nature Reserve Fund and under- lying laws. Indeed, in 2020, the Ukrainian Par- liament registered Bill No.4461 “On Territories of the Emerald Network”, under which Ukraine undertakes to protect and conserve its natural habitats according to European standards. However, the legislation has not yet been 1 The World Database on Protected Areas (“WDPA”) 2 QGIS (Quantum Geographic Information System) – a free, open-source software for creation, visualization and analysis of geospatial information) 3 Terrestrial Ecoregions of the World (“TEOW”) 4 Global Lakes and Wetlands Database 5 Cabinet of Ministers of Ukraine, Resolution No. 935 of November 23, 1995 (Kyiv), "On Measures for the Protection of Wetlands of International Importance." Cabinet of Ministers of Ukraine, Directive No. 147-r of February 23, 2011, "On Approval of Granting Wetlands the Status of Wetlands of International Importance." Cabinet of Ministers of Ukraine, Directive No. 895-r of September 21, 2011, "On Approval of Granting Wetlands the Status of Wetlands of International Importance." Cabinet of Ministers of Ukraine, Directive No. 818-r of October 24, 2012, "On Approval of Granting Wetlands the Status of Wetlands of International Importance." adopted. However, the bill does not entirely prohibit agricultural activities within the territo- ries of the Emerald Network, provided they are of low intensity and do not damage protected habitats. Any new or intensified agricultural practices (e.g., conversion to intensive farm- ing, installation of irrigation systems, pesticide use) must undergo an appropriate environ- mental assessment in line with the Law on En- vironmental Impact Assessment (EIA). Regarding wetlands of international im- portance, only 328 hectares have some level of intersection with GLWD Level 3 or Ramsar list polygons across 18 fields (the average weighted level of intersection with protected areas across these fields is 19%). However, further analysis revealed that these territories are not recognized by Ukrainian legislation as wetlands of international importance, in line with the provisions of the Ramsar Convention; therefore, our operations are fully compliant with relevant laws 5 . We identified that our material dependency on biodiversity and ecosystem services is associ- ated with soil productivity and pollination, which is key for ensuring the long-term stabil- ity of yields and, therefore, high operational performance of our Farming segment. Furthermore, we are committed to preventing deforestation and any forms of expansion of arable lands at the cost of natural habitats and other territories not intended for farming, both in our own operations and in our supply chain. Importantly, Ukraine is considered a low-risk country in relation to deforestation, consider- ing that forestry and agricultural land banks are governed by different laws that prohibit the conversion of forests into agricultural land. Ad- ditionally, Ukraine is historically known for its large territories of agricultural land (almost 70% of the country’s territory), which have not been forested over the last 50 years. Issues of illegal deforestation in Ukraine are specific to the lands of the forest fund and are not asso- ciated with agricultural activities. Neverthe- less, in FY2025, Kernel started an in-depth preparation to ensure compliance with the EU Deforestation Regulation (EUDR). E4.IRO-1 Biodiversity and ecosystem-related impacts, risks and opportunities Biodiversity- and ecosystem-related IROs were identified through geospatial analysis of overlaps with protected areas, impact assess- ment, and consultations with internal subject matter experts. At this stage, the evaluation fo- cused on Kernel’s operations, with the inten- tion of extending the scope in the future. The assessment included both actual and po- tential impacts. For agricultural operations, we consider greenhouse gas emissions to be a driver of climate change and a possible con- tributor to biodiversity loss. We also identified actual pressures on species, particularly polli- nators such as bees, that are affected by the use of agrochemicals and pesticides. In paral- lel, we identified positive effects of regenera- tive farming practices, including reduced till- age, the use of cover crops, and improved ………………………………………………………………….………………………………………………………………………………………………………… Demonstration of the geometric intersection analysis Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 64 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Environmental information continued nutrient management, which help restore soil health, support ecosystem stability, and en- sure stable yields. Dependencies were also analyzed, with a focus on ecosystem services such as pollination, which are crucial to agri- cultural productivity and contribute to the economic benefits of the Group. For further details on the methodological ap- proach applied under the DMA, see pages 48- 49. The table below summarizes the material IROs identified for E4 Biodiversity and ecosystems, including their location in the value chain and the timeframe over which as- sociated risks, opportunities, and potential im- pacts, both positive and negative, may mate- rialize. MDR-P; E4-2 Policies We are strongly committed to both minimizing our negative impact on biodiversity and under- taking specific measures to conserve and boost biodiversity across our landbank. This approach is reflected in our Environmental Protection policy, and we are expecting our suppliers to uphold the same standards through the Supplier Code of Conduct. In the next reporting period, we plan to adopt a ded- icated Sustainable Agriculture Policy that will address biodiversity and ecosystem manage- ment. Environmental Protection policy does not currently cover deforestation. We have es- tablished a working group to monitor regula- tory developments and ensure compliance with the EUDR, with a deforestation-specific policy planned for a later stage. See Annex 3 – Key Policies and Procedures for a detailed description of all Kernel policies. MDR-A Actions and resources The key principle in delivering our commit- ments towards biodiversity is ensuring com- prehensive and detailed monitoring of our farming activities, which we perform through- out our innovative “DigitalAgriBusiness” farm management system. By integrating IT, AI, 1 Normalized Difference Vegetation Index quantifies vegetation by measuring the difference between near-infrared (which vegetation strongly reflects) and red light (which vegetation absorbs). NDVI is a standardized way to measure healthy vegetation – the higher the NDVI, the healthier vegetation. 2 Rotterdam Convention on the Prior Informed Consent Procedure for Certain Hazardous Chemicals and Pesticides in International Trade and Big Data solutions, we collect and analyze field-level and operational data, which en- hances precision farming practices, strength- ens risk management, and ensures careful oversight of our interactions with natural eco- systems. All our fields are cultivated using RTK-guided autopilot machinery, with RTK signals shared among partners to expand pre- cision farming coverage. We also monitor our fields through remote sensing technologies by collecting data, such as NDVI 1 , from satel- lites, helicopters, and on-site data collection facilities, which are then synchronized in data- bases and analyzed with GIS (Geographic In- formation Systems) programs. These insights are embedded into daily operations: agrono- mists use tablets equipped with a “Mobile Agronomist” scouting application, improving risk assessment and accelerating decision- making in the field. Furthermore, we under- take thorough due diligence before the conclu- sion of the lease, which includes evaluation of the physical condition, such as quality of soil and existing vegetation, as well as the legal status of the land, namely ownership rights, registered land use limitations, and legal suit- ability for farming, which also includes proxim- ity to conservation areas. Our practical approaches to minimizing the adverse impacts of our farming operations on biodiversity include the following: • Promotion of soil biodiversity. Kernel ac- tively researches and tests applications of biological fertilizers, including phosphorus- and nitrogen-fixing bacteria. We are the first agricultural producer in Ukraine to establish and run our own microbiological laboratory, where we closely evaluate the benefits of bi- ological fertilizers on soil health. We also utilize bio-destructors, namely bacteria and fungi, which contribute to maintaining soil biodiversity while intensifying the decompo- sition of organic crop residues mulched and left in fields, leading to a subsequent return of nutrients from the residue back to the soil. Bio-destructors also have a fungicidal ef- fect, protecting crops from harmful microor- ganisms. In FY2025, the total area of appli- cation of biological products accounted for 208,940 hectares. • Integrated pest management system. When undertaking pest control actions to reduce crop exposure to diseases, we com- ply with applicable national and interna- tional regulations. We only use authorized plant protection products, listed in the State registry of pesticides and agrochemicals al- lowed to be used in Ukraine. Also, we do not apply chemicals prohibited by the Stock- holm Convention on Persistent Organic Pol- lutants and products, listed in Annex 3 of the Rotterdam Convention 2 We constantly Environmental Material Impacts, Risks and Opportunities Value chain Time horizon 1 Sustainability matter IRO IRO nature Description Upstream Own operations Downstream E4 Biodiversity and ecosystems Climate change Negative impact Potential Greenhouse gas emissions from agricultural activities contribute to cli- mate change, which can lead to biodiversity loss and disruption of ecosys- tems. ● ● L Impacts on the state of species Negative impact Actual Harm to pollinators due to the application of pesticides and agrochemicals, leading to declines in species such as bees and negatively affecting crop pollination and ecosystem health. ● ● - Impacts on the extent and condition of ecosys- tems Positive impact Actual Restoration of soil health and ecosystem stability through regenerative ag- ricultural practices such as reduced tillage, use of cover crops, and effec- tive nutrient management. ● ● - Impacts and dependen- cies on ecosystem ser- vices Positive impact Actual Ensure timely communication with beekeepers about agricultural activities on the fields, specifically the application of plant protection products that prevent harm to pollinators and support pollination services, thereby en- hancing crop productivity and promoting biodiversity conservation. ● ● - Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 65 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Environmental information continued improve our pest management approaches by adjusting them in line with legislative changes on pesticides in other countries. For example, since 2021, we have been gradually reducing the use of neonicotinoid products. Before using a new substance on the operational scale, we test it on our R&D fields (more than 25 thousand hectares). Pesticides are applied by self-propelled spraying machinery equipped with a posi- tioning control system that deactivates sprayers outside field boundaries, prevent- ing overlapping and re-application. In addi- tion, machines have automatic remote con- trols for weather conditions, which account for wind, allowing for minimized off-the-field releases of pesticides. • Control of seed quality. For sowing cam- paigns, Kernel only uses breeds and hy- brids of seeds, listed in the State Registry of Plant Species Eligible for Cultivation in Ukraine, which excludes genetically modi- fied seeds. All seeds, either produced inter- nally or sourced from the market, undergo a thorough examination in Kernel’s accred- ited laboratory before sowing. • Monitoring soil nutrients. At least once per crop rotation cycle, we analyze soil quality at our agrochemical laboratory by taking over 2,000 soil samples (from 25-30 centimeters depths). Based on the evalua- tion results, we adjust our crop mix plans, production technology, and fertilization practices where required. A test-based ap- proach to fertilizer application allows for maintaining a deficit-free balance of nutri- ents and thus prevents deterioration of soil quality. • Protection of pollinators. Kernel imple- ments a system of notifying beekeepers who operate near our fields about plans to apply plant protection products. Notification is provided no later than 3 days before pes- ticide application, with details on exact date and time, location, as well as type of chem- icals and method of application. We are also taking into account weather conditions, spe- cifically wind speed. MDR-T; E4-4 Targets Kernel has set specific targets that directly ad- dress the areas identified in our assessment and track the effectiveness of biodiversity-re- lated actions. One of the crucial factors in agriculture relates to pollinator health, where the use of agro- chemicals can negatively affect species such as bees, while at the same time, our business depends on the pollination services they pro- vide. To mitigate this impact and safeguard critical ecosystem services, we have commit- ted to achieving 100% use of pollinator-safe insecticides during the flowering of crops by 2030 (minimization layer). This target not only reduces harm to pollinators but also strengthens the resilience of local ecosystems and ensures the continuity of crop productivity. Another priority area is soil health, which is a key factor influencing both ecosystem stability and agricultural yields. In this context, we have set the target of applying biological destruc- tors on at least 50% of its cultivated land- bank by 2030 (rehabilitation layer). By doing so, we aim to improve soil quality, enhance bi- odiversity below ground, and reinforce the positive contribution of our farming practices to ecosystem resilience and agroecological transition. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 66 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Environmental information continued E5 Circular economy In this section: • Waste E5.IRO-1 Circular economy-related impacts, risks and opportunities Our circular economy and resource use-re- lated IROs were identified and assessed rely- ing on the standard materiality assessment approach. This involved mapping our opera- tions, evaluating the effects of circular econ- omy practices, and analyzing our waste man- agement processes within business seg- ments. Risks and opportunities were consid- ered through the lens of dependency analysis. The process was guided and supported by our internal subject matter experts within the envi- ronmental team. The analysis covers Kernel’s own operations, with a view to potentially ex- tending the scope across the entire value chain. While the perspectives of affected com- munities were not directly solicited, they were indirectly considered through the review of complaints and feedback received. For further details on the methodological ap- proach applied under the DMA, see pages 48- 49. The table below summarizes the material IROs identified for E5 Circular economy, in- cluding their location in the value chain and the timeframe over which associated risks, op- portunities, and potential impacts, both posi- tive and negative, may materialize. MDR-P Policies Kernel recognizes the importance of sustaina- ble waste management and the need to mini- mize the environmental impact associated with waste generation. Our Environmental Protection policy and Supplier Code of Con- duct establish the foundation for responsible waste management, emphasizing waste re- duction, reuse, and continuous improvement across our operations and value chain. The Environmental Protection policy is aligned with the Law of Ukraine on Waste Manage- ment, updated in 2023, which harmonized na- tional legislation with European Union stand- ards and best practices. Key highlights of the new legislation included: • Extended Producer Responsibility (EPR): Producers are now accountable for the entire lifecycle of their products, partic- ularly the waste they generate. This in- cludes packaging, electrical and electronic equipment, batteries, and other products. Producers must finance the collection, recy- cling, and disposal of their products' waste. • Waste Management Hierarchy: The law emphasizes a waste management hierar- chy that prioritizes waste prevention, fol- lowed by preparation for reuse, recycling, other recovery operations (e.g., energy re- covery), and disposal as a last resort. • Municipal Waste Management: A munici- pal household waste management system is established and managed by an Adminis- trator responsible for the effective collection, billing, and handling of claims re- lated to waste services. • E-Waste System: A unified state electronic waste system (e-waste) will be introduced to manage waste data and interactions electronically, enhancing transparency and accountability. • Hazardous Waste Management: Stricter regulations for hazardous waste, including the requirement for permits for collection, transport, and treatment, as well as specific requirements for waste incineration and landfill operations. We also expect our suppliers to uphold the same standards in their operations as outlined in the Supplier Code of Conduct. For further details, please refer to Annex 3 – Key Policies and Procedures. MDR-A Actions and resources Minimization of waste, as well as its proper treatment, is one of the key indicators of Ker- nel’s operational efficiency. We aim to imple- ment measures towards the reduction of the overall volume of waste through the moderni- zation of technological processes, including the reuse of waste across divisions, contrib- uting to the long-term sustainability of our business, as well as through the establish- ment of controls over waste generation, trans- portation, and storage. In FY2025, Kernel continued to enhance its operational practices across the Farming, In- frastructure & Trading, and Oilseed Pro- cessing segments, focusing on strengthening resource circularity and minimizing envi- ronmental impact through three distinct ac- tion streams. Resource circularity The actions of this stream focus on turning by- products and residues into valuable inputs across our production chain. Particularly, in the Farming segment: • Crop residues are normally left distributed on the field, incorporated into the soil, or mulched, thereby enhancing soil health by increasing organic matter and returning car- bon to the soil. Part of the straw is used for cattle management as bedding. No crop residue is burned on the field, as it is strictly forbidden. • Manure, the primary waste from animal husbandry, is removed from cowsheds via scrapper conveyors and transported to em- banked storage areas for natural compost- ing. All storage sites are located outside of settlements, in leeward areas, and away from water protection buffer zones to avoid contamination. Manure is mainly applied in fields as organic fertilizer, and part of it is distributed among local communities for gardening purposes – closing the nutrient loop. In FY2025, we applied organic fertiliz- ers, namely manure, over an area of 857 ha. Environmental Material Impacts, Risks and Opportunities Value chain Time horizon 1 Sustainability matter IRO IRO nature Description Upstream Own operations Downstream E5 Circular economy Waste Negative impact Actual Generation of waste that contributes to the environmental burden. ● - Positive impact Actual Valorization of waste through its use in generating green electricity. ● - Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 67 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Environmental information continued In the Infrastructure and Trading segment, generation of waste is associated mainly with the grain purification process and includes: • Fraction of substandard grain and crop residue, separated from main products and mainly used as cattle fodder in our animal husbandry business or sold to third parties. In addition, we use crop residue as a fuel on one of our drying installations for the gener- ation of steam. In the Oilseed Processing segment, waste is primarily generated during sunflower oil pro- duction and electricity generation: • The primary waste stream from processing is sunflower husk, which is used as a bio- mass fuel in combined heat and power (CHP) plants at all our oil extraction facili- ties. This enables the generation of electric- ity for both internal consumption and sale to the national grid, as well as steam required for the production of sunflower oil. • A further byproduct, sunflower ash, results from the combustion process in power gen- eration and is repurposed as a raw material for fertilizer production. Ash is valuable for its chemical composition, namely its high potassium content and lack of hazardous admixture. Applying ash in fields allows us to return a part of the harvested nutrients back to the soil. Circular Product & Packaging Design Under this action stream, Kernel focuses on reducing environmental impact through sus- tainable packaging solutions and responsible material choices, particularly within its Oilseed Processing operations. In this segment, the main product is crude oil, sold in bulk for further processing by custom- ers, eliminating the need for packaging and minimizing waste generation. The remaining volume of produced oil is refined, bottled, and packed for consumer markets. Thus, packag- ing waste, primarily plastic and cardboard, occurs downstream, at the customer level. To reduce the environmental impact at this stage of the value chain, we are actively working to transition to recycled plastic bottles and teth- ered caps. These efforts directly support cir- cular economy objectives, aiming to reduce virgin material use, improve recyclability, and minimize packaging-related waste. Responsible Waste Management & Com- pliance In this action stream, Kernel ensures environ- mentally sound management of non-circular waste streams. In both the Farming segment and cross-segment activities, we follow strict procedures to minimize environmental and health risks associated with waste manage- ment: • Pesticide packaging is collected sepa- rately, depending on the class of hazard, and transferred to a licensed provider of waste disposal services. • Animal mortality waste, such as cows’ carcasses, is disposed of in registered bio- thermal pits in compliance with the require- ments of the State Veterinary Committee. • Additional types of waste arise from operational household activities, such as machinery maintenance, construction and engineering works, and wastewater treat- ment. These streams are handled following national environmental standards to mini- mize risks to the environment and human health. Waste that cannot be reused within the pro- duction chain is transferred to licensed dis- posal or recycling providers, selected from an official list maintained by the Ministry of Envi- ronmental Protection of Ukraine. The Ministry ensures compliance through regular verifica- tion, and violations can result in license revo- cation. We expect our contractors to adhere to the same waste management standards, re- quiring them to control waste generation and prevent mixing different types of waste. Con- tractors must also provide agreements with li- censed disposal and recycling services as proof of compliance. The Group's efforts reflect a dedicated ap- proach to managing waste efficiently, adher- ing to regulations, and implementing innova- tive solutions for waste reduction and circular- ity. MDR-T; E5-3 Targets Kernel has established a voluntary target for resource use and the circular economy to en- hance the sustainability of our packaging. By 2030, we aim for 20% of bottled oil to be packaged in bottles made from recycled plastic and 20% of bottles to be equipped …………………………………………………………………..……………………………………………………………………..……........................................................................................................... Scheme of Kernel’s waste management cycle Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 68 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Environmental information continued with tethered caps. This target addresses material impact related to waste generation, particularly associated with plastic use, while promoting circular product design. The initia- tive contributes to increasing the share of re- cycled materials in packaging and reducing dependence on virgin plastic. Within the waste hierarchy, this target is classified under Recy- cling, as it supports the reuse of secondary materials and strengthens circularity in pack- aging solutions. MDR-M Waste accounting methodology Waste is classified into two main categories: hazardous and non-hazardous. Hazardous waste primarily includes used oil, rags, filters, batteries, fluorescent lamps, and chemical re- agents. Non-hazardous waste covers house- hold waste, seed-cleaning residues, used tires, plastics, paper, and cardboard. Biomass is accounted for separately as a biofuel. Waste data is collected across the Company’s Processing, Farming, and Infrastructure seg- ments, using primary data sources supple- mented by estimates where necessary. Data are provided by accounting specialists, de- partment managers, and technical experts, such as the chief energy engineer, senior fore- man, and commercial manager, through cor- porate programs and information systems. EU Taxonomy The Kernel reports its contribution to the Eu- ropean Union’s environmental objectives of climate change mitigation and adaptation, in line with the guidelines laid down in the EU Taxonomy regulations. In response to these requirements, we have conducted a compre- hensive analysis of our economic activities, in- cluding the revenue they generate, as well as our capital expenditures (CapEx) and opera- tional expenditures (OpEx). Besides, we iden- tified the share of activities that meet the EU Taxonomy criteria or, in other words, are con- sidered “environmentally sustainable”. 1 NACE code D35.11 in accordance with the statistical classification of economic activities, established by Regulation EC No 1893/2006 The identified taxonomy-eligible economic ac- tivity falls under the category “Electricity gen- eration from bioenergy” 1 and refers to the production of electricity from biomass, namely sunflower seed husk, at our cogeneration heat and power (CHP) plants. This “green CapEx” investment project, launched in 2017 and completed in 2024, resulted in six CHP units with a combined electricity generation capac- ity of 84.4 MW. Our taxonomy-eligible activity has the poten- tial to save up to 700 thousand tCO2e of na- tional emissions every year, contributing sig- nificantly to Ukraine’s transition to a net-zero emissions economy. As of FY2025, Kernel has been operating six CHPs. Metrics E5 -5 Waste Key waste management indicators in FY2025 tons Hazardous Non-hazardous Total Total waste generated 227.7 26,964.0 27,191.7 Total waste diverted from disposal 68.4 12,653.4 12,721.8 Recycling 68.4 12,653.4 12,721.8 Total waste directed to disposal 160.3 14,483.7 14,644.1 Landfill - 7,321.8 7,321.8 Other disposal operations 1 160.3 7,161.9 7,322.2 Total non-recycled waste, tons 160.3 14,483.73 14,644.1 Total non-recycled waste, % 70.4 53.7 53.9 Note 1: Transferred for utilization. Taxonomy-eligible share of Kernel’s economic activities FY2024 FY2025 USD million Amount Share Amount Share Revenue, including 3,581.0 100% 4,115.0 100% taxonomy-eligible 48.7 1.4% 53.4 1.3% taxonomy non-eligible 3,532.3 98.6% 4,061.6 98.7% Capital expenditure 1 , including 158.6 100% 68.8 100% taxonomy-eligible 5.7 3.6% 2.2 3.2% taxonomy non-eligible 152.9 96.4% 66.6 96.8% Operational expenditure, including 3,176.0 100% 3,828.0 100% taxonomy-eligible 24.0 0.8% 43.9 1.2% taxonomy non-eligible 3,152.0 99.2% 3,784.1 98.9% Note 1: Additions in CIP and uninstalled equipment for the respective period (Note 14). Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 69 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Social information S1 Own workforce In this section: • Working conditions − Secure employment − Working time − Adequate wages − Work-life balance − Health and safety • Equal treatment and opportunities for all − Gender equality and equal pay for work of equal value − Training and skills development − Employment and inclusion of people with disabilities − Diversity S1.SBM-3 Impacts, risks and opportunities and their interaction with strategy and business model Kernel’s workforce includes its employees, both permanent and temporary, working on a full-time and part-time basis. The main cate- gories of impacts identified include both nega- tive and positive dimensions. On the negative side, impacts relate to compromised working conditions due to climate-related factors such as extreme heat or seasonal variability, work- life balance challenges where support measures are unevenly applied, and health and safety concerns arising from accidents, occupational diseases, or mental overload linked to long working hours. These are not systemic or widespread issues but rather po- tential and context-specific impacts that are being monitored. On the positive side, the Group’s high share of permanent contracts and stable market posi- tion contribute to secure and predictable em- ployment, particularly in times of full-scale war. Further, contributions to training and equal access to knowledge-sharing initiatives enhance workforce resilience and capabilities, while targeted inclusion programs for people with disabilities and veterans promote a more diverse and equitable workplace. These measures create opportunities for Kernel to access a broader talent pool and improve adaptability in the face of sectoral and eco- nomic change. From a risk perspective, how- ever, the potential loss of employees and in- stitutional knowledge represents financial and operational vulnerability. For further details on the methodological ap- proach applied under the DMA, see pages 48- 49. The table below summarizes the material IROs identified for S1 Own workforce, includ- ing their location in the value chain and the timeframe over which associated risks, oppor- tunities, and potential impacts, both positive and negative, may materialize. MDR-P; S1-1 Policies Kernel’s general approach towards managing human resources is defined by the Code of Conduct and is built on four principles, namely (1) involvement as internal entrepreneurship, (2) partnership and unity of goals, (3) mutual respect and trust, and (4) development of hu- man potential. Our practices are strictly aligned with the Labor Code of Ukraine and other relevant national legislations, as well as the International Labor Organization’s (ILO) Fundamental Conventions. Kernel has zero tolerance for any form of forced or compulsory labor or child labor. Kernel has an unwavering Social Material Impacts, Risks and Opportunities Value chain Time horizon 1 Sustainability matter IRO IRO nature Description Upstream Own operations Downstream S1 Own workforce Secure Employment & Working Time & Adequate Wages Negative impact Actual Climate-related changes (e.g., extreme heat, seasonal variability) may alter working conditions, potentially compromising working time. ● - Positive impact Actual High share of permanent contracts and stable market position, espe- cially in volatile conditions, has a positive impact on employees by providing a secure and predictable work environment. ● - Work-life balance Negative impact Potential Lack of support for work-life balance initiatives, or unequal access to such measures, can negatively affect employee well-being, satisfac- tion, and productivity, potentially leading to higher turnover and absen- teeism. ● S Health and safety Negative impact Potential Workplace health and safety is compromised by both physical impacts, i.e., accidents and occupational disease, and mental overload, stem- ming from factors like the intensity and duration of working hours. These issues can negatively impact employees’ health , productivity, and overall well-being. ● S Training and skills development Positive impact Actual Ensuring equal access to knowledge sharing and in-house upskilling creates broader development opportunities for employees, while strengthening the company’s resilience and self- reliance during talent shortages. ● - Risk Financial Loss of employees and institutional know-how may lead to capability gaps, increased recruitment costs, and operational disruption. ● S Employment and inclusion of persons with disabilities Positive impact Actual Fostering a more equitable and ethical work environment by promoting inclusion and diversity, including the development of tailored integra- tion programs for veterans and their families. ● - Opportunity Strategic Gaining access to a broader and more diverse talent pool, driving in- novation, and improving organizational adaptability. ● S Diversity Negative impact Potential Diversity imbalance in professional roles can undermine motivation, engagement, and career progression for underrepresented groups. ● - Opportunity Strategic Access to a broader talent pool through diverse hiring. ● S Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 70 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Social information continued commitment to human rights, which is a fun- damental principle employed at every corpo- rate level. Kernel ensures a transparent ap- proach to remuneration and equal payments in line with the Compensation and Benefits policy. The principles of ensuring the safety of em- ployees are embodied in the Security policy. Apart from that, the Group’s strategy on the safety of workers has been put into clearer perspective amid the Russian full-scale inva- sion of Ukraine and ongoing military actions. Indeed, upon the declaration of martial law, Kernel adopted the Resilience in Times of War policy, which outlines the principles guiding the Group’s adaptation to unique external challenges and disruptions. On the opera- tional level, the Group is guided by the Occu- pational Health and Safety policy, which has also been updated to reflect the emerging needs of wartime, specifically to ensure tai- lored care for mental health. Our position on internationally proclaimed hu- man rights is defined in our Sustainability De- velopment and Corporate Social Responsibil- ity policy and aligned with the principles of the UN Global Compact, which Kernel signed in 2020. Our approach to safeguarding equal op- portunities and maintaining a non-discrimina- tory working environment is guided by the Lux- embourg Law of 23 July 2016 and our Anti- Discrimination and Diversity, Equality, and In- clusion (hereinafter – “DE&I”) policy. As an ad- aptation to the new societal circumstances triggered by wartime, Kernel adopted the Working with Veterans policy, which guides the integration of demobilized employees in the professional and social environments. We expect the same level of responsibility re- garding relations with employees throughout our supply chain. Our counterparties are obli- gated to comply with our Supplier Code of Conduct, which requires them to ensure fair and safe working conditions for their employ- ees and compliance with labor legislation. These requirements are reflected in the rele- vant contractual provisions. See Annex 3 – Key Policies and Procedures for a detailed description of all Kernel policies disclosed. S1-2 Engagement with employees Kernel conducts annual feedback sessions in the form of questionnaires at every stage of an employee's life cycle in the Group, namely (1) upon completion of a probation period, (2) every year after performance assessment and tailored professional training, and (3) exit in- terviews and feedback when an employee leaves the Group. A separate line of engage- ment and feedback is available for veterans. Additionally, every year, we conduct anony- mous satisfaction, loyalty, and engagement surveys, which involve all employees. When measuring satisfaction, the survey considers how employees rate compensation, working conditions, team atmosphere, relationships with management, development opportuni- ties, and communication. Engagement is re- flected in a willingness to share experiences and take proactive steps. The primary objec- tive of this exercise is to identify negative im- pacts and gaps in the Group’s management approaches and work towards their elimina- tion; to identify positive impacts and strengthen positive performance factors; and to define general ways for the Group to de- velop as an employer. In terms of involving employees in the Group’s strategic discussions and decision-making processes, Kernel holds annual conferences for every business segment and department. During these conferences, representatives from the Executive Management Team and functional managers collaborate closely to re- view the previous year's performance, identify key lessons learned, and explore new strate- gic ideas. The director of each business seg- ment and department is responsible for ensur- ing that this form of engagement takes place and its results are efficiently integrated into the operational activity. All Kernel’s employees also have the oppor- tunity to proactively contribute their vision and implement their ideas on improving opera- tional efficiency across business segments through the incentive program “Synergy of Change”. Employees are rewarded if their suggestions contribute to an increase in the Group’s EBITDA. Furthermore, engagement with employees is a fundamental aspect of the Group’s occupa- tional health and safety management (herein- after - OHSMS) and is actively encouraged through various channels. The “Near Miss”, “Stop Card”, and “Walk The Talk” initiatives provided platforms for employees to report safety concerns, suggest improvements, and participate in safety projects. We employ pro- active methods to engage our employees in the development, implementation, and evalu- ation of the effectiveness of the OHSMS, as well as to communicate information related to occupational health and safety (OHS), namely via corporate surveys, the “Gold Safety Rules” initiative, which recognizes best set of labor safety requirements, composed by employees themselves; and the “Walk the Talk” project, that allows OHS specialists and manager ex- plore gaps in OHSMS by interviewing employees and discussing their ideas on im- provements. Since 2020, Kernel has been a signatory to the UN Global Compact, declaring its align- ment with key internationally recognized prin- ciples of protection of human rights of employ- ees, including the Universal Declaration of Hu- man Rights and the International Labor Or- ganization’s (ILO) Declaration on Fundamen- tal Principles and Rights at Work. MDR-A; S1-4 Actions and resources Employment safety Amid the Russian invasion of Ukraine and on- going military actions, the safety and well-be- ing of Kernel’s workforce have been of utmost priority. Kernel ensures that all its offices and production sites have air alert systems and ap- propriate shelters. Both the workforce and counterparties working on site are obligated to proceed to shelters when air alerts are in ef- fect. The Group ensures that production pro- cesses remain uninterrupted through remote management during such times. In FY2025, Kernel continued providing exten- sive support to its employees, especially those who are defending the country or who are in- ternally displaced. During FY2025, 141 of our employees were enlisted in the Armed Forces of Ukraine, whereas 102 employees were de- mobilized. The total monetary support pro- vided to enlisted employees over FY2025 amounted to USD 3,313 thousand. As of 30 June 2025, 829 of our employees are serving in the Armed Forces of Ukraine. Furthermore, in FY2025, Kernel provided USD 389 thou- sand of financial support to employees who suffered disability as a result of military actions and the families of employees who were killed in action. Remuneration approach and adequate wages Kernel’s remuneration approach is built on three pillars, namely: 1. Base compensation and benefits. The basic level of Kernel’s remuneration system includes: − salaries and wage-based bonuses that match or exceed the benchmark of other industries. It also includes addi- tional payments and compensation, de- pending on working conditions, as well as fixed payments in the event of retire- ment and financial support in the case of an employee’s difficult personal cir- cumstances. When personnel optimiza- tion occurs, resulting in a reduction in the number of employees, the wage fund is not reduced correspondingly but is redistributed among the remaining team members. − healthcare services, including voluntary Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 71 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Social information continued medical insurance for full-time employ- ees, life insurance for employees, who cover insurance costs, and OHS insur- ance. − rewards for improvements in produc- tion, both monetary (such as one-time monetary incentives for operational ac- complishments) and non-financial recognitions. − other benefits include sponsorship of educational opportunities and sports activities, provision of food at work- places, free transportation to work, etc. 2. Reward for leadership. Each year, em- ployees undergo an assessment of their competencies, both self-assessment and evaluation by a linear manager. Based on the results, employees’ base salaries may be reviewed (more information on annual performance appraisal and career advance- ment in the section Training and career ad- vancement) 3. Incentive system. This system aims to en- sure that the career goals of our employees, business targets of business divisions, and long-term strategic goals of the Group are synchronized. Kernel annually establishes financial and operational quantitative and qualitative goals, which are cascaded down to specific KPIs of employees in relevant business segments. Employees can also establish their own KPIs. Annual perfor- mance assessment quantifies the achieve- ment of KPIs and automatically impacts the size of the annual performance bonus. The system is fully transparent and prevents any prejudice. We provide employees with all the tools to directly affect KPIs and monitor the KPIs’ execution on a close-to-online ba- sis. Occupational health and safety Kernel’s OHSMS operates in line with national regulations and ISO 45001 standards, and is led by an OHS corporate manager who re- ports annually to a management committee headed by the Group’s CEO. Within the OHSMS, the process of identifying and as- sessing work-related hazards and safety risks is exercised on a non-routine and annual ba- sis. A non-routine procedure of risk identifica- tion takes place for new business operations and assets, and results in a list of hazards and risks. The risk identification on an annual basis is reflected in the responsibilities of managers, OHS professionals, and other employees to update the list of hazards, basing their inputs on results of internal and external labor safety audits, the outcomes of employees’ engage- ment process, and feedback, conclusions drawn from incidents investigations, as well as results of OHS assessments and incorpora- tion of world best practices. OHS assess- ments include self-assessments and statutory 1 Acronym stands for Eliminate, Reduce, Isolate, Control, Personal Protective Equipment, Discipline. inspections, information on which is consoli- dated in a special database. Once potential risks and hazards are identi- fied, the OHSMS triggers the procedure of risk management, which is organized in line with the ERIC/PD 1 hierarchy of hazard controls and consists of the following steps, taken in descending priority: • Fully eliminate a risk or a hazard • Reduce the potential impact of a risk or a hazard • Isolate a risk or a hazard from employees • Control a risk or a hazard by providing em- ployees with personal protective equip- ment, training, detailed instructions and in- formation, means of first response, as well as lockout/tagout devices. In the event of work-related incidents, we launch an investigation of each case, using the Ishikawa, or “fishbone diagram” approach that aims: (1) to identify root causes of an inci- dent, (2) to map risks and hazards that mate- rialized, (3) to determine corrective actions in line with the ERIC/PD hierarchy of hazards control, and (4) to integrate lessons learned into required improvements of the OHSMS. This information is diligently recorded in the accident statistics, which also includes data on the frequency of occupational accidents, sub- sequent lost workdays, and the severity of in- juries. For every work-related accident, we create a special investigation commission that might also include representatives of relevant au- thorities. As a result of an investigation, the commission issues a report detailing the cir- cumstances of the incident and recommenda- tions to improve the risk management ap- proaches and to prevent the occurrence of such incidents in the future. Such an approach aims to ensure continuous improvement of the OHS practices to achieve the central target of zero work-related injuries and fatalities. To ensure alignment of our OHS approaches with national legislation and best practices, we conduct annual state inspections (5 in FY2025 with no fines imposed). Additionally, all em- ployees covered by the OHSMS undergo an internal audit every year, and in FY2025, 6,902 employees were audited externally. Fur- thermore, Kernel allocates significant re- sources to prevent occupational health and safety violations and incidents through rigor- ous annual training. In FY2025, Kernel invested a total of USD 2.1 million in occupational health and safety. These funds were allocated to enhance safety infrastructure, provide training, and improve health services for employees. Work-life balance Since the full-scale Russian invasion, Kernel has been implementing the corporate program “Resilience. Strength Within You,” aimed at breaking the stigma around seeking psycho- logical support and fostering a culture of self- care by supporting the mental, physical, and social well-being of employees through educa- tional, sports, and motivational activities. It is structured around the development of four key life areas: mental health, social relationships, physical well-being, and creativity. The strate- gic goal is to enhance employee productivity and engagement by improving psychological resilience, physical health, and social connec- tions, while reducing stress and burnout and fostering a culture of self-support. In practice, the program is implemented by organizing webinars, training sessions, and psychologi- cal consultations; holding sports events, mar- athons, and physical challenges; launching creative activities such as art therapy and photo contests; and developing a corporate Telegram channel with useful content. The program’s target audience includes 11 thousand employees (7.5 thousand of whom do not have email access) across Ukraine and their families. The initiative also targets fami- lies of employees serving in the army and vet- erans, 70% of whom reside in small towns and villages. Expected outcomes include a three- fold increase in psychological support re- quests, 50% employee engagement in project activities, a 5% reduction in staff turnover, as well as improved psychological resilience and overall well-being. In FY2025, a total of 5,834 people participated, representing a 35% in- crease compared to the previous year. Partic- ipants benefited from over 22 thousand hours of training. Training and skills development Kernel’s approach to professional develop- ment of its own workforce is based on the Competency Model. This model comprises eight key competencies established in line with Kernel’s business strategy, priorities, and targets to maximize the Group’s long-term value. These competencies were initially iden- tified through Group-wide research and up- dated in FY2025. Kernel’s key professional competencies are the following: 1. Strategic thinking 2. Responsibility 3. Systematic thinking 4. Partnership and collaboration 5. Adaptivity and improvement 6. Customer-oriented approach Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 72 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Social information continued 7. Team management and leadership 8. Internal entrepreneurship Employees covered by the Competency Model undertake an annual assessment, after which they create an individual development plan. The individual development plan con- sists of three parts: (1) hard learning, which provides for the attraction of internal or exter- nal experts and the allocation of individual learning budgets; (2) soft learning, which is re- alized through Kernel’s Institute of Internal Couches; and (3) distance learning, which em- ployees can access through an online educa- tional platform, Kernel Hub, which provides more than 1 thousand e-books, 155 e- courses, and 200 training videos. Together, these learning activities form the corporate minimum package, which includes one profes- sional course and at least three general devel- opment courses. The competency model ap- plies to both managers and specialists, ensur- ing that all employees receive professional ed- ucation tailored to their development plans and job descriptions, which outline standard skill requirements for each position. Over the last two years, the Group has been implementing a strategy of safeguarding in- house expertise and the expansion of profes- sional skills. The Group has already devel- oped electronic courses on key business pro- cesses, including logistics, oilseed and grain purchasing, and the operation of transship- ment terminals. Kernel also leverages oppor- tunities of Artificial Intelligence (AI) in develop- ing training content, which allows for reducing time spent on courses development by 6 times and saving the budget by 4 times. Gender equality, human rights, inclusion and diversity In line with DE&I policy, Kernel aspires to reach at least 30% representation of each gender within the Group’s corporate bodies, namely the Board of Directors and the Execu- tive Management Team. We have designated individuals and teams responsible for imple- menting the DE&I Policy at every corporate level, ensuring the adoption of diversity, equal- ity, and inclusion principles in all business ac- tivities of Kernel. At the Board of Directors’ level, matters related to the integration of di- versity principles are overseen by the Nomina- tion and Remuneration Committee, whereas the Chief Executive Officer is responsible for the implementation of the DE&I Policy throughout the Group. As the wartime context became closely inter- linked with the Group’s everyday life, last year Kernel started an adaptation program for vet- erans with the primary focus on the Group’s employees who were demobilized and going back to civilian life. The program seeks to help veterans in their self-realization and smooth integration into business processes. It con- sists of three key components, namely: (1) physical recovery, including compensation of costs of medical treatment and prosthetics; (2) mental recovery involving tailored work with professional psychologists; (3) integration into the workplace, which also implies specific training on communication skills and ethics for other employees. The latter might also include alterations of a workplace or machinery to ac- commodate a person’s prosthetics. Upon re- turn to work, veterans may also change their previous professional qualifications with spe- cial support from the HR department. Kernel’s veterans’ adaptation program was recognized in Forbes Ukraine's Top-25 rating. The pro- gram includes a mandatory protocol for man- agers who supervise veterans, requiring regu- lar face-to-face meetings to review profes- sional performance, KPIs, personal needs, and, most importantly, to provide care and mental health support. Managers are respon- sible for monitoring the well-being of veterans and offering timely assistance. Additionally, Kernel facilitates and supports gatherings for the corporate veteran community, including a dedicated networking channel for veterans on Telegram and occasional offline events. MDR-T; S1-5 Targets Kernel has set workforce targets to track the effectiveness of our actions and address ma- terial sustainability matters. In the area of di- versity and inclusion, we are committed to in- creasing women’s representation in tradi- tionally male-dominated positions to 15% by 2030. This target reflects our ambition to broaden access to opportunities and foster a more inclusive workplace. In parallel, we rec- ognize the strategic importance of talent de- velopment for the Group. To this end, by 2030, we aim to ensure that at least 10% of open vacancies are filled by graduates of our Internship and First Job programs. This target enhances our ability to retain institu- tional knowledge, develop internal experts, and support the career progression of young professionals entering the workforce. We also strive for the continuous development of ca- reer opportunities and an inclusive work- ing environment for women, youth, veter- ans, and people with disabilities. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 73 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Social information continued Metrics S1-6 Characteristics of employees Key human resources indicators (as of 30 June) FY2023 FY2024 FY2025 Total number of employees 10,733 10,904 10,760 including by geography: Ukraine 10,691 10,851 10,703 Other countries 42 53 57 including by level: Managers 885 879 889 Specialists 3,110 3,157 3,229 Workers 6,738 6,868 6,642 including by business segment: Oilseed Processing 2,530 2,479 2,193 Infrastructure and Trading 2,741 2,894 3,056 Farming 4,508 4,527 4,451 Head office and other 954 1,004 1,060 including by age less than 30 years old 1,585 1,548 1,507 up to 50 years old 2,992 6,110 5,969 more than 50 years old 6,156 3,246 3,284 including by employment contract, by region: Permanent 10 077 10 259 10 090 Ukraine 10 035 10 206 10 033 Other countries 42 53 57 Seasonal and temporary (only Ukraine) 656 645 670 including by employment contract, by gender: Permanent 10 077 10 259 10 090 Male 7 347 7 469 7 382 Female 2 730 2 790 2 708 Seasonal and Temporary 656 645 670 Male 586 580 586 Female 70 65 84 including by employment type, by gender: Full-time 10 647 10 067 10 172 Male 7 877 7 418 7 509 Female 2 770 2 649 2 663 Part-time 86 837 588 Male 56 631 459 Female 30 206 129 Key employment indicators FY2023 FY2024 FY2025 Total number of new hires 2,711 2,464 2,293 by geography Ukraine 2,711 2,456 2,282 Other countries 0 6 11 by gender Male 1,866 1,745 1,640 Female 603 717 653 by age less than 30 years old 684 735 726 up to 50 years old 1,312 1,320 1,053 more than 50 years old 473 407 514 Total number of employees who have left 2,163 1,491 2,493 by gender Male 1,623 1,073 1,773 Female 713 418 720 by age less than 30 years old 477 320 535 up to 50 years old 646 411 824 more than 50 years old 1,040 760 1,134 Total number of employees who left Kernel due to retirement 103 83 77 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 74 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Social information continued Metrics S1-9 Diversity Kernel’s top management is the Executive Management Team, as defined by the Corpo- rate Governance Charter. The Team consists of 14 directors of the Group’s business seg- ments and departments, headed by the CEO. They are responsible for Kernel’s overall oper- ational and financial performance. More infor- mation on the Executive Management Team, as well as data on the composition and diver- sity of the Board of Directors, is provided in the Corporate Governance section. S1-10 Remuneration and adequate wages In FY2025, Kernel’s total payroll accounted for a total of USD 161 million; 189 employees were receiving minimum wage (166 FTE ba- sis). Employees working with a full-time workload (coefficient = 1.0) are classified as full-time. Those with a workload below 1.0 are catego- rized as part-time. S1-12 People with disabilities In FY2025, the share of socially vulnerable employees was 28% out of the total number of employees, and 7% of all employees were in- dividuals with disabilities. S1-13 Training and skills development During FY2025, a total of 3,278 employees evaluated their competencies and created in- dividual development plans. Throughout the year, 8,167 employees benefited from Ker- nel’s educational programs, spending 216,517 hours of training (an average of 26.5 hours per employee), 42% of which were dedicated to improving hard skills and 58% to improving soft skills. Furthermore, 9,608 employees en- gaged in at least one course on Kernel Hub, our online educational platform. Key diversity and equality indicators (as of 30 June) FY2023 FY2024 FY2025 Executive Management Team distribution, % by gender Male 80% 80% 80% Female 20% 20% 20% by age 30-50 years old 87% 87% 80% more than 50 years old 13% 13% 20% Employees distribution, % by gender Male 74% 74% 74% Female 26% 26% 26% by age less than 30 years old 15% 14% 14% up to 50 years old 28% 56% 55% more than 50 years old 57% 30% 31% Key training and education indicators FY2023 FY2024 FY2025 Average hours of training per employee 30.4 27.2 26.5 by gender: Average hours of training per male 29.9 28.3 25.5 Average hours of training per female 31.4 27.8 25.2 by employee category: Average hours of training per manager 39.1 34.8 33.1 Average hours of training per specialist 40.0 34.0 31.9 Average hours of training per worker 18.8 19.3 16.5 Total number of training hours 207,596 200,188 216,517 including by skill sets Hard skills 161,037 128,298 90,445 Soft skills 46,559 71,890 126,072 including by learning formats Full-time training 63,293 60,120 35,529 Distance Learning 144,303 140,067 180,988 including by frequency Annual / regular training 95,758 41,508 18,986 One-time training 108,746 151,732 186,585 Modular development programs 3,092 6,948 10,946 Key employees’ career development indicators FY2023 FY2024 FY2025 Total number of employees, receiving regular perfor- mance and career development reviews 1,647 1,676 1,894 including by gender Male 1,273 1,270 1,466 Female 374 406 428 including by employee category Managers 621 756 659 Specialists 1,026 920 1,235 S1-14 Health and safety Key occupational health and safety indicators 1 (as of 30 June) FY2023 FY2024 FY2025 Recordable work-related injuries 11 14 16 Oilseed Processing - 3 4 Infrastructure and Trading 8 5 12 Farming 3 6 - High-consequence work-related injuries (ex. Fatalities) 2 5 3 Oilseed Processing - 1 2 Infrastructure and Trading 1 1 1 Farming 1 3 - Fatalities resulted from work-related injuries - 1 - Oilseed Processing - - - Infrastructure and Trading - 1 - Farming - - - Rate of recordable work-related injuries (LTIFR) 0.61 0.76 0.85 Rate of fatalities as a result of work-related injury - 0.05 - Rate of high-consequence work-related injuries (excluding fatalities) 0.11 0.27 0.16 Note 1: Indicators for FY2023 and FY2024 were corrected in this report as the result of identified accounting discrepancies. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 75 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Social information continued S1-17 Incidents and complaints There were no instances of discrimination and severe human rights incidents connected to the own workforce have occurred over FY2025. All submissions to Kernel’s grievance mecha- nism are recorded in the Unified Register of Reports and are processed per the Procedure for Receiving and Reviewing Information Re- ceived via Hotline Channels. More information about the process of compiling data on work- related grievances, incidents, and complaints related to social and human rights matters is provided in the “Grievance mechanism” sub- section (see page 81). In FY2025, a total of 81 enquiries from employees were received. MDR-M Own workforce accounting methodology To ensure accurate and consistent reporting of the Group’s workforce data, the following methodology is applied annually to calculate the number of active employees as of June 30: 1. Employee data is extracted from the official HR management system using the report ti- tled "Employee List of the Organization", with the reporting date set to June 30. 2. The primary filter applied is “Main Place of Work” under the Employment Type cate- gory. This ensures that only individuals em- ployed at their primary place of work are in- cluded in the dataset. Employees engaged under internal part-time or additional em- ployment contracts are excluded to prevent double-counting. 3. Only employees who are officially part of the Group as of June 30 are included in the re- port. Any individuals who, for technical or transitional reasons, remain in the system but are no longer affiliated with the Group are manually excluded from the dataset. 4. The dataset is classified by the following categories: − Business division − Employment type (full-time/part-time) − Job level − Geography and region − Gender − Age group − Employment contract type 5. Additional validation is conducted for em- ployees working in other countries to ensure accurate geographic classification and avoid data inconsistencies. 6. The dataset is reviewed for potential outliers or anomalies, which may arise due to sys- tem errors or data entry issues. Such en- tries are investigated and corrected or re- moved as necessary. 7. Final calculations and aggregations are per- formed using pivot tables in Microsoft Excel. This approach enables the generation of structured breakdowns across the required reporting dimensions. S1-15 Work -life balance Parental leave indicators FY2023 FY2024 FY2025 Male Female Male Female Male Female Employees who were entitled to parental leave 192 68 223 60 179 37 Employees who took parental leave 1 75 0 40 0 76 Employees who returned to work in the reporting period after parental leave ended 0 63 1 68 0 78 Employees due to return to work after taking parental leave 1 164 0 135 0 133 Employees who were still employed 12 months after their return to work 0 37 0 25 0 29 Kernel’s specific metrics Occupational health and safety training in FY2025 OHS trainings, participants 3 693 OHS trainings, hours 7 790 Participants in electronic OHS training 2 121 Number of emergency response drills 212 Employees involved in emergency response drills 1 315 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 76 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Social information continued S3 Affected communities In this section: • Adequate food • Water and sanitation • Land-related impacts S3.SBM-3 Impacts, risks and opportunities and their interaction with strategy and business model This section covers communities with whom Kernel has a direct relationship through its own operations. Therefore, communities living or working around Kernel’s farming opera- tions, grain storage facilities, oilseed pro- cessing sites, and export terminals are subject to potential or actual material impacts. Thus, communities affected by Kernel’s upstream segment, namely procurement facilities and farms not owned or operated by Kernel, are excluded from this section. Across the regions where we operate, we have identified material positive impacts that reflect our commitment to addressing local community needs. Notably, through the provi- sion of food products, Kernel contributes to better health, livelihoods, and overall food se- curity for rural and local communities. In addi- tion, our investments in water infrastructure and sanitation facilities have improved access to clean and safe water, leading to reduced disease risks and enhanced community health outcomes. Land-related impacts also repre- sent a significant area of opportunity. Because land is one of our strategic production re- sources, Kernel recognizes its responsibility to respect land rights and ensure our operations do not cause adverse impacts. Through trans- parent communication and fair lease prac- tices, we build long-term trust and partner- ships with landowners and communities, se- curing stable access to land while creating shared value for both communities and the Group. These IROs are not uniform across all affected communities. While food and water initiatives benefit all directly connected com- munities, land-related opportunities are more relevant to the landowners and farming-adja- cent populations where land access and use are essential livelihood factors. For further details on the methodological ap- proach applied under the DMA, see pages 48- 49. The table below summarizes the material IROs identified for S3 Affected communities, including their location in the value chain and the timeframe over which associated risks, op- portunities, and potential impacts, both posi- tive and negative, may materialize. MDR-P; S3-1 Policies At Kernel, we strive to be a responsible neigh- bor and reputable partner to local communities and support the Ukrainian society overall. These priorities are reflected in our Social Im- pact and Community Engagement policy and Sustainable Development and CSR policy. The Group acknowledges the impact of its op- erations on the communities we engage with and is committed to upholding human rights according to the Human Rights policy in line with the UN Guiding Principles on Business and Human Rights and the OECD Guidelines for Multinational Enterprises. We strive to fos- ter understanding of the cultures, traditions, and values of the local communities in which we operate. To this end, we promote inclusive and open dialogue, ensuring that underrepre- sented and vulnerable groups are heard and actively involved. Where human rights impacts occur, we are committed to enabling access to effective remedies, while maintaining pro- cesses to monitor compliance and address material issues transparently. See Annex 3 – Key Policies and Procedures for a detailed description of all Kernel policies. S3-2 Engagement with affected communi- ties The Group’s approach towards effective inter- action with different groups of stakeholders is guided by the Stakeholder Engagement policy specified on pages 46-47, which includes an extensive plan of our interactions with key stakeholders like local communities. The Group systematically engages with com- munities to identify, minimize, or prevent po- tential impacts of its activities on human rights, well-being, and sustainable local develop- ment. Kernel’s community engagement pro- cess follows a structured cycle of stakeholder mapping, consultation, feedback integration, and monitoring. Engagement is conducted both directly and through legitimate representatives or trusted intermediaries - such as community leaders, local NGOs, opinion leaders, and social infra- structure workers, who have a deep under- standing of the local context, needs, and chal- lenges. We ensure that community perspec- tives are embedded at all key stages of initia- tive development: • Before project launch - Conduct consulta- tions, joint planning sessions, round tables, public discussions, and focus groups to gather community opinions, concerns, and needs. • During project implementation – Collect Social Material Impacts, Risks and Opportunities Value chain Time horizon 1 Sustainability matter IRO IRO nature Description Upstream Own operations Downstream S3 Affected communities Adequate food Positive impact Actual Contributing to better health, livelihoods, and overall food security through the provision of food products. ● - Water and sanitation Positive impact Actual Better health and reduced disease risks through investments in wa- ter infrastructure, improving access to clean and safe water. ● - Land-related impacts Opportunity Financial Land-use restrictions during project development can temporarily disrupt local livelihoods. ● M Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 77 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Social information continued and integrate regular feedback to adapt ap- proaches and actively involve communities in project monitoring. • After project completion - Carry out im- pact assessments and community satisfac- tion surveys to evaluate results and inform future initiatives. The frequency of interaction is proportionate to the scale of the initiative, namely, large so- cial projects require monthly engagement, while smaller ones, as needed, but at least once a year. The CSR Department is respon- sible for stakeholder identification and en- gagement, while the Head of CSR Service holds operational accountability for these pro- cesses. The Group also recognizes the importance of considering the interests of vulnerable and marginalized groups in its social engagement processes. The priority groups include women and girls, internally displaced people, people with disabilities, the elderly, low-income households, youth, and veterans. The Group’s engagement measures are tailored to the spe- cific needs of vulnerable and marginalized groups, ensuring accessible formats, gender- sensitive approaches, trusted intermediaries, and confidentiality safeguards. This approach removes participation barriers and enables these groups to contribute actively to decision- making and benefit from social initiatives. Kernel regularly evaluates the effectiveness of its engagement with communities through an- nual surveys on communication quality and the impact of implemented initiatives, analysis of complaints and requests, and social impact assessments. S3-3 Processes to remediate negative im- pacts Kernel is committed to preventing, mitigating, and remediating any negative impacts arising from its activities. This includes expert assess- ments of social, environmental, and infrastruc- ture factors, followed by corrective measures ranging from financial compensation to adjust- ments in operating practices. Where specific issues arise, e.g., road damage, the Group de- velops and executes targeted recovery plans. These measures are designed not only to re- solve immediate problems but also to prevent their recurrence and strengthen long-term community trust. To ensure affected commu- nities can express concerns, submit pro- posals, or communicate their needs, the Group maintains an accessible, transparent, and effective grievance mechanism. More in- formation on the procedure is provided in the “Grievance mechanism” subsection (see page 81). MDR-A; S3-4 Actions and resources In alignment with Kernel’s social impact strategy, the Group implements a broad range of initiatives that support: • Community healthcare • Education • Culture and sports • Military support and rehabilitation for veter- ans • Infrastructure improvements • Community economic growth • Community capacity building • Barrier-free accessibility • Energy independence and energy effi- ciency These initiatives aim to prevent social isolation and discrimination while improving the quality of life, particularly for vulnerable groups. In shaping its initiatives, the Group strives to bal- ance business objectives with community needs by applying inclusive project selection processes, co-financing mechanisms, and ac- tively engaging the community. This approach not only generates positive outcomes for com- munities but also helps prevent and mitigate potential negative impacts. Effectiveness of initiatives is evaluated using both quantitative and qualitative indicators for specific projects. We take preventive measures to avoid and mitigate potential neg- ative impacts on communities. Operational ac- tivities are planned with careful attention to stakeholder needs, supported by ongoing communication through established channels. Key community initiatives Goal Actions Location Participants My community: Together with Kernel Foster community development by equipping participants with practical crowdfunding skills and by supporting the creation and implementation of lo- cal initiatives that promote sustaina- ble growth. - Training and mentoring support, during which partici- pants gained knowledge in project planning, crowd- funding, communications, and partnership building. - Co-funding of social projects based on the results of the training and the presentation of participants’ initia- tives. Poltava Kropyvnytskyi Starokostiantyniv Chornomorsk Myhiivska and Syniu- khyno-Bridska communi- ties 70 training partici- pants 33 projects co - funded Empowered: A Platform for Community Provide training for representatives of local self- government, civil society or- ganizations, and community initiative groups on key aspects of territorial development. Creation of an online course combining theory and practical tools to help participants effectively mobilize resources, manage local finances, build partnerships, and implement socially significant projects. Over 250 communities (1st wave) 206 communities (2nd wave) 479 participants (1st wave) 481 participants (2nd wave) Rehabilitation for Service Members and Their Families Deliver rehabilitation support to ser- vice members returning from combat zones, as well as to their families, to restore the physical, psychological, and emotional well- being of Ukraine’s defenders and their loved ones. Provision of medical procedures, psychological sup- port, and spaces for physical activity and mental recov- ery in a safe, natural environment. Tysovets village, Lviv Region 109 people re- ceived rehabilita- tion services Maindi Social Franchise – Implemented within the First Lady of Ukraine Olena Zelenska’s national initiative Integrate rehabilitation spaces into the local healthcare system to en- hance secondary, long- term rehabili- tation during the post- acute recovery phase. Installation of mobile rehabilitation units and medical equipment. Kropyvnytskyi Holovanivsk Poltava Talne 617 people under- went medical treat- ment Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 78 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Social information continued For example, in transporting raw materials and goods via local roads, routes are selected to avoid disrupting local traffic. The Group moni- tors vehicle movement, load levels, and transport methods to reduce disturbance and funds annual improvements to local road con- ditions. All processes comply with Ukrainian laws and standards, limiting impacts on the environment, public health, and infrastructure. Sanitary zones are established around facili- ties with ongoing monitoring of pollution, noise, and other factors. These measures help prevent conflicts from significant negative im- pacts of operations or decisions. No severe human rights issues or incidents with affected communities were reported in FY2025. The Group reduces community-related risks by in- vesting in social development and maintaining ongoing communication and engagement. Guided by integrity-based stakeholder rela- tions, Kernel strengthens social legitimacy, ex- pands its community presence and relation- ships, and builds partnerships with local self- government bodies. MDR-T; S3-5 Targets Kernel has set a target to strengthen its con- tribution to local community well-being by en- hancing access to and participation in social programs. By 2030, the Group aims to in- crease beneficiary participation in its com- munity initiatives by 10% across all re- gions of operation. This target reflects our commitment to fostering inclusive and resilient communities, ensuring that social benefits reach a broader share of stakeholders, includ- ing underrepresented and vulnerable groups. “Worth Acting” Grant Program Implement targeted projects to sup- port war veterans, the families of de- ceased veterans, and the families of fallen Defenders of Ukraine. Grant support for the implementation of veterans’ busi- ness initiatives in partnership with the Ukrainian Veter- ans Foundation, the Ministry of Veterans Affairs of Ukraine, and the IT Group SKELAR. 20 regions of Ukraine Kyiv 130 veterans' busi- nesses Children of the Unbreakable Provide holistic care and support for children of fallen, missing, or captive Defenders of Ukraine, ensuring their well -being and prospects. - Organization of a summer camp for children. - Excursions, cinema visits, and trips to entertainment centers. - Holiday events to mark International Children’s Day. - Weekend family tours. - Birthday gifts. - Distribution of 88 tablets to children for educational purposes and access to online learning. - Purchase of gift certificates for children’s clothing, footwear, and school supplies. - Sanatorium rehabilitation provided to children to- gether with their mothers. Territories of the Com- pany’s operational pres- ence (190 communities) 135 children Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 79 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Social information continued S4 Consumers and end-users In this section: • Health and safety of consumers and/or end- users S4.SBM-3 Impacts, risks and opportunities and their interaction with strategy and business model In identifying IROs related to consumers and end-users, Kernel considered various types of consumers, including B2B customers and in- dividual consumers who purchase our prod- ucts directly. The scope of the assessment in- cluded all consumers who may be materially impacted by both our operations and value chain. A positive impact identified relates to consumer health and safety. By adhering to in- ternationally recognized certification stand- ards, rigorous food safety management sys- tems, and continuous monitoring, we en- sure that all products meet high safety and quality benchmarks. This impact provides di- rect benefits for both B2B customers, who can rely on safe, sustainable, and high-quality in- puts for their operations, and individual con- sumers, who benefit from safe and nutritious food products. For further details on the methodological ap- proach applied under the DMA, see page 48- 49. The table below summarizes the material IROs identified for S4 Consumers and end-us- ers, including their location in the value chain and the timeframe over which associated risks, opportunities, and potential impacts, both positive and negative, may materialize. MDR-P; S4-1 Policies For Kernel, as a leading producer of grain in Ukraine and sunflower oil globally, the quality of its products and the health of its consumers are the highest priorities. Our management approach towards ensuring the highest quality of our goods is embedded in the Safety and Quality Management policy. The policy aims to establish a unified system for managing product quality and safety issues, creating conditions for their continuous development in line with international standards (ISO, GMP+, ISCC, IFS, BSCI, etc.) and the Sustainable Development Goals. At the center of our ap- proach is the preventive food management system, which seeks to mitigate potential risks of biological, chemical, and physical hazards before they become material. See Annex 3– Key Policies and Procedures for a detailed description of all Kernel policies. S4-2 Engagement with consumers Kernel exercises four main channels of en- gagement with consumers, namely: 1. Research of consumers' preferences, awareness about the Group’s activities, conducted by specialized agencies before and after launching new products or intro- ducing any changes. 2. Interaction via Kernel’s official social media, where consumers ask questions and ex- press their concerns. All feedback received is analyzed and addressed. 3. B2B engagement through sales represent- atives, who gather and process feedback on operational aspects. 4. Grievance mechanism, accessible to all stakeholders (see more information on page 81). The Group responds to every in- quiry, and in cases related to product qual- ity, provides full documentation and, when needed, conducts additional laboratory tests to confirm compliance with the highest standards. MDR-A; S4-4 Actions and resources We adhere to the highest standard of quality in both the final goods and production pro- cesses throughout the whole value chain. Our oil-extraction plants are certified with ISO 9001 “Quality management system” and ISO 22000 “Food safety management” standards, which integrate the principles of the Hazard Analysis and Critical Control Point (HACCP) system and application of procedures devel- oped by the Codex Alimentarius Commission. Ensuring the quality of crop production and storage Within the whole landbank of Kernel, 358 thousand hectares (11 Farming enterprises) are certified with ISCC EU requirements, which ensures that crop production is per- formed in environmentally and socially sound ways. Under this certification, produced crops are considered compliant with biofuel supply chain sustainability requirements outlined in the EU RED II. At all our grain silos we build our food safety management system on the HACCP principles (Hazard Analysis Critical Control Point), namely: (1) conduct a hazard analysis, (2) determine critical control points (CCPs),(3) establish critical limits, (4) estab- lish monitoring procedures, (5) establish cor- rective actions, (6) establish verification proce- dures, and (7) establish record-keeping and documentation procedures. The implementa- tion of these principles aims to prevent and re- duce the occurrence of food safety risks through analysis and control of biological, chemical, and physical hazards throughout the storage chain. Ensuring the quality and safety of sun- flower oil Kernel’s oil-crushing processes in Poltava are certified in line with ISO 9001 and ISO 22000 standards; bottling processes are additionally certified in line with the IFS and BRCGS standards. They also underwent a validation under the BSCI scheme (grade A), reflecting our commitment to social responsibility as an Social Material Impacts, Risks and Opportunities Value chain Time horizon 1 Sustainability matter IRO IRO nature Description Upstream Own operations Downstream S4 Consumers and end-users Access to (quality) in- formation Risk Financial Failure to comply with environmental regulations (e.g., the EU De- forestation Regulation) may restrict market access and limit busi- ness opportunities. ● ● M Health and safety Positive impact Actual Adherence to rigorous certification standards and proactive man- agement of the health and safety impacts ensures the high quality of the consumed products. ● ● ● - Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 80 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Social information continued employer and maintaining high standards of social performance. Our laboratory is also cer- tified (ISO 17025 “General requirements for the competence of testing and calibration la- boratories”), and conducts regular sample analysis of sunflower oil, meal, and grain to confirm their compliance with quality stand- ards. Our TransBulkTerminal is certified to conduct fumigation activities in accordance with Gafta standards. Furthermore, our production assets are com- pliant with Kosher, Kosher Passover, Badatz, and Badatz Passover requirements of Jewish regulations, as well as the Muslim Halal food standards. Four of our plants are registered by the U.S. Food and Drug Administration (FDA), making our sunflower oil, including high oleic sunflower oil, in bottles and flexi-tanks suitable for the USA market. Additionally, one of our plants obtained a country-specific license to sell sunflower oil to South Korea. Six of our oil extraction plants, as well as our trading entities, are certified in line with ISCC EU standards, which makes the production of sunflower oil and meal compliant with the legal sustainability requirements of the EU Renew- able Energy Directive (Directive (EU) 2018/2001 also known as RED III) and the Fuel Quality Directive. Ensuring the quality and safety of meals Our whole value chain of protein meal is certi- fied with the applicable feed quality and safety standard, namely GMP+. All our oilseed pro- cessing plants are certified with GMP+R1.0; our export terminals, as well as trading enti- ties, Kernel-Trade and Inerco, are certified with GMP+R1.0, ensuring feed safety in the production, storage, transshipment, and trade of meals. In addition, five of our oil extraction plants, as well as two trading entities, Kernel- Trade and Inerco, are certified in line with ISCC PLUS, with regard to meal production. Our products, namely oil (sunflower, rape- seed, and soy) and meal (sunflower and rape- seed), have also been validated and identified as compliant with country-specific regulations of the People’s Republic of China. The Group’s internal quality management team, responsible for overseeing the entire food safety system, is regularly inspected and verified by independent third-party auditors. The audit scope covers all stages of the value chain, including production, storage, distribu- tion, and supply, ensuring that 100% of signif- icant products are assessed for potential health and safety improvements. In FY2025, a total of 265 independent audits were success- fully passed, which were performed through- out 435 days. Supporting decarbonization goals of con- sumers Within its climate corporate governance, Ker- nel seeks to scale up climate mitigation ac- tions not only across its own operations, but also in supporting the reduction of Scope 3 emissions for its customers. In Farming, we ensure traceable accounting of the carbon footprint of grains and oilseeds, which allows us to provide tailored batches of low-carbon products upon a customer's request. In Oilseed Processing, we aim to leverage our own generation of renewable energy from bio- mass to reduce Scope 2 emissions from sun- flower oil production. In FY2025, Kernel was chosen as a partner of the Jumbo Impact Fund - the supply chain en- gagement program developed by our client Jumbo Supermarkten. The program seeks to facilitate the reduction of Jumbo's Scope 3 GHG emissions by co-financing targeted pro- jects within its value chain. As part of the Jumbo Impact Fund, we’ve ensured that our production of bottled sunflower oil is low-car- bon. MDR-T; S4-5 Targets To strengthen our actions in relation to consumers and end-users and their expecta- tions, Kernel has set forward-looking targets that link product quality with sustainability per- formance. By 2030, we aim to launch a new product category - sunflower oil with a ver- ified reduced carbon footprint across the entire value chain. This target responds to the market demand for sustainable food prod- ucts while reinforcing our commitment to cli- mate action. In addition, we are preparing to ensure full compliance with the EU Defor- estation Regulation (EUDR), thereby assur- ing our customers that our products are not associated with deforestation or ecosystem conversion. Together, these targets demon- strate how Kernel engages with consumers through innovation and regulatory alignment to deliver safer, more sustainable, and respon- sible products. Metrics There were no instances of incompliance with regulations or voluntary codes or human rights issues, which would have resulted in fines, penalties, or warnings in FY2025. Kernel’s specific metrics Matrix of Kernel’s product quality certification Standard Oilseed processing plants Terminals Trading Farming Total Bandurka Kropyvnytskyi Poltava BSI Prydniprovksyi Starokostiantyniv TransBulkTerminal TransGrainTerminal OilExportTerminal Kernel-Trade Inerco ISO 9001 ✓ ✓ ✓ ✓ ✓ ✓ ✓ 7 ISO 22000 ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ 8 GMP+R 1.0 ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ 15 ICS ✓ 1 Kosher ✓ ✓ ✓ ✓ ✓ ✓ ✓ 7 Kosher Passover ✓ 1 Badatz Passover ✓ 1 Halal ✓ ✓ ✓ ✓ ✓ ✓ ✓ 7 FDA registration ✓ ✓ ✓ 3 ISCC EU ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ 19 ISCC PLUS ✓ ✓ ✓ ✓ ✓ ✓ ✓ 7 BRCGS ✓ 1 IFS ✓ 1 Gafta ✓ 1 China (sunflower meal) ✓ ✓ ✓ ✓ ✓ ✓ 6 China (sunflower oil) ✓ ✓ ✓ ✓ ✓ ✓ 6 China (rapeseed meal) ✓ ✓ ✓ ✓ 4 China (rapeseed oil) ✓ ✓ ✓ ✓ 4 China (soybean oil) ✓ ✓ ✓ ✓ 4 China (soybean meal) ✓ ✓ ✓ ✓ 4 ISO 14001 ✓ 1 ISO 45001 ✓ 1 Total 13 10 14 13 14 13 3 4 1 5 3 16 109 ✓ certificates obtained in FY2025 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 81 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Social information continued S1-3; S3-3; S4-3 Grievance mechanism Kernel has a grievance mechanism through which the Group’s employees across all seg- ments and subsidiaries, suppliers, consum- ers, local communities, and other stakehold- ers have an opportunity to submit inquiries and complaints related to human rights viola- tions or discriminatory actions, as well as to receive redress if an investigation determines that such violations took place. Submissions to the grievance mechanism can be made via (1) an anonymous toll-free round-the-clock hotline, (2) form on Kernel’s website, (3) via email by writing to hotline@kernel.lu or com- pliance@kernel.lu, (4) Telegram chatbot “Ker- nelHotline”. Operation of the grievance mech- anisms is embedded in the Group’s “Manage- ment and the Prevention of Fraud and Corrup- tion” policy and “Code of Conduct”. The policy not only emphasizes the right but also outlines the cases when employees are obligated to report misconduct. Kernel also sends out peri- odic internal reminders to all employees re- garding available reporting channels and the operation of the Hotline. The Group guarantees confidentiality, protec- tion of anonymity, and respect for the rights of whistleblowers. Indeed, Kernel has in place a Procedure for Whistleblower Protection. Un- der these frameworks, Kernel is obligated to protect and assist anyone who submits inquir- ies (see Annex 3 - Key Policies and Proce- dures). Additionally, any employee can flag and report occupational health and safety risks they ob- serve and report about hazardous situations on a worksite by reaching out to their supervi- sor, field OHS specialist, or the Group’s cor- porate manager. Employees can also raise any OHS issues by submitting a “Near Miss” and “Stop Card” letter forms or contacting the corporate Hotmail. All submissions are recorded in the Unified Register of Reports and are processed in ac- cordance with the Procedure for Receiving and Reviewing Information Received via the Hotline Channels. Reports are forwarded to the responsible personnel according to the subject matter, with a copy sent to the Head of the Compliance Department. Each business segment and department has defined pro- cesses and timelines for handling submis- sions, and compliance specialists monitor ad- herence to deadlines and the quality of the re- sponse. Feedback to the whistleblower is pro- vided by employees who undertook the re- view, or by the compliance specialist if the re- sponsible party fails to respond. Regular anal- ysis of reports is conducted, and findings are shared with management through a monthly Hotline report, quarterly reports for the Human Resources Director, and monthly reports for directors of the Group’s business segments. Kernel conducts an annual anonymous survey to assess employees’ knowledge and under- standing of compliance requirements and business ethics. This survey helps evaluate employees’ awareness and trust in the exist- ing channels for reporting violations and re- ceiving feedback. As part of the annual conflict of interest declaration, employees are asked whether they have the ability to report viola- tions via the Hotline channels, which helps de- termine how well employees know and are willing to use these communication channels. The Compliance Department analyzes the col- lected information and based on the results, implements measures to improve awareness, strengthen trust, and enhance relevant proce- dures and communication channels. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 82 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Governance information G1 Governance In this section: • Business conduct − Corporate culture − Protection of whistleblowers − Management of relationships with sup- pliers, including payment practices • Corruption and bribery − Prevention and detection, including training − Incidents G1.IRO-1 Governance-related impacts, risks and opportunities Kernel is committed to operating with integrity, embedding responsibility and ethical conduct at the core of its corporate culture. Material IROs related to business conduct, including corruption and bribery, were identified through internal dialogue, analysis of governance per- formance metrics, and sectoral benchmark- ing, taking into account both our own opera- tions and business relationships across the value chain. For further details on the methodological ap- proach applied under the DMA, see pages 48- 49. The table below summarizes the material IROs identified for G1 Governance, including their location in the value chain and the timeframe over which associated risks, oppor- tunities, and potential impacts, both positive and negative, may materialize. G1.GOV-1 Governance bodies Detailed information about Kernel’s govern- ance structure, as well as the role of govern- ance bodies related to business conduct, is provided in the Corporate Governance sec- tion. Regarding the sustainability expertise within the supervisory body, the Group’s Board of Di- rectors operates a Sustainability Committee, comprising three non-executive directors and the Chief Executive Officer. Members of the committee bring expertise in sustainability matters, including climate risks and opportuni- ties, decarbonization, environmental protec- tion, and social and human capital develop- ment. Their expertise covers these matters from the perspectives of finance, international trade, and strategic development. Within the Executive Management Team, key sustaina- bility-related expertise is concentrated across several functions, namely: • Sustainability function • Corporate social responsibility function • Occupational health and safety function • Ecology and environmental compliance function • Quality management function MDR-P; G1-1 Policies We have zero tolerance for any fraudulent and corrupt activities, both among our employees and counterparties. Our position on anti-cor- ruption and approach towards ensuring ethical compliance is embodied in Kernel’s “Corporate Governance Charter”, “Code of Conduct”, “Conflict of Interest Management and the Prevention of Fraud and Corruption” policy (which was reviewed and updated in FY2025), and the “Supplier Code of Conduct”. In addition, all our agreements and tendering processes include the mandatory Anti-corrup- tion clause. The Protection of Whistleblowers procedure ensures that employees are encouraged and safeguarded when reporting misconduct and incidents related to anti-corruption. The Group’s Sanctions policy plays a crucial role in managing critical issues such as exports to sanctioned countries. It provides Kernel’s partners with a clear understanding of the Group's position on sanctions regulations, in- cluding those imposed as a result of the Rus- sian invasion of Ukraine. See Annex 3 – Key Policies and Procedures for a detailed description of all Kernel policies. G1-2 Management of relationships with suppliers Quality interactions with suppliers are one of the key aspects of Kernel’s ESG and climate governance agenda. Kernel’s process of sup- ply chain management consists of four stages: • Setting E&S standards. Our expectations of suppliers’ environmental and social per- formance are defined by relevant provisions of the Code of Interaction with Suppliers and the Anti-Corruption Clause, which re- flect Kernel’s commitments to the principles of the UN Global Compact and Sustainable Development Goals. They include require- ments on ethics, fair business practices, hu- man rights, occupational health and safety, and environmental protection. • Ensuring obligatory E&S compliance. Before entering into business relationships, all counterparties are obligated to sign Ker- nel’s Anti-Corruption Clause in the contract. Kernel is entitled to verify compliance with relevant provisions and terminate contracts if non-compliance is identified. • Compliance verification. The procedure for confirming suppliers’ compliance with Kernel’s E&S requirements consists of two levels. First, all potential counterparties un- dergo initial screening by the corporate Economic Security Service. Environmental Governance Material Impacts, Risks and Opportunities Value chain Time horizon 1 Sustainability matter IRO IRO nature Description Upstream Own operations Downstream G1 Governance Corporate culture Positive impact Actual Adherence to corporate culture influences employees to behave more ethically ● ● ● - Protection of whistleblowers Positive impact Actual Promotion of early reporting of unethical behavior or misconduct fos- ters transparency and accountability within the organization and im- proves the social well-being of employees ● - Management of relation- ships with suppliers, in- cluding payment prac- tices Positive impact Actual Timely payments strengthen relationships with suppliers and overall value chain resilience ● ● ● - Opportunity Strategic Opportunity to promote sustainability and innovation by building strong supplier partnerships ● ● ● M Prevention and detec- tion of corruption, in- cluding training Positive impact Actual Anti-bribery and anti-corruption training supporting employees in pre- venting and detecting bribery ● - Corruption and bribery incidents Negative impact Actual Bribery incidents provoke loss of credibility and strain stakeholder re- lationships ● - Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 83 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Governance information continued and social criteria are included in the scope of initial screening, focusing on the analysis of the location and nature of suppliers’ op- erations, certification by relevant E&S standards, such as ISCC, ISO14001, and ISO18001, as well as the outcomes of envi- ronmental inspections, etc. The second level of verification is an audit that involves visits to suppliers. • Production facilities, interviews with management and personnel, and review of relevant documentation. During the verification process, we provide feedback to suppliers on possible ways to improve their E&S performance, if required. • Application of business consequences. Based on the results of audits, Kernel either continues cooperation with counterparties or suggests corrective measures if non- compliance with our E&S requirements is identified and monitors their implementa- tion. Another possible consequence of sup- pliers’ non-observance is the termination of business relationships. G1-3 Prevention and detection of corrup- tion and bribery Responsibility to enforce provisions of policies and procedures on corruption prevention lies centrally on Kernel’s compliance officer, who reports directly to the CEO and the Audit Com- mittee. Integrity across the Group is anchored in the “Tone at the Top,” ensuring that leader- ship sets clear expectations for ethical behav- ior. Regional compliance coordinators support this framework by implementing standards on the ground and promoting continuous im- provement in compliance practices across op- erational assets. In addition, the Compliance Officer provides confidential guidance to em- ployees on compliance matters, ensuring that all staff have access to trusted advice when needed. All Group operations are subject to regular screening for corruption risks. In total, 19 risks were identified, with the most significant in- cluding: (1) obtaining undue benefits, which might lead to financial losses and reputational damages; (2) conflict of interest; (3) working for other companies and entrepreneurial activ- ities. To mitigate these risks, managers and specialists are required to submit annual con- flict of interest declarations, while all employ- ees receive training to identify and address potential conflicts. In addition, corruption risk screening forms an integral part of the hiring process, particularly for candidates with prior government backgrounds. To address corruption risks among counter- parties, Kernel’s security department performs KYC (Know Your Customer) compliance as- sessments for all business partners and responds to integrity concerns submitted through the Hotline (19 calls in FY2025). Where medium or high corruption risks, con- flicts of interest, or potential international sanc- tions are identified, compliance officers con- duct enhanced due diligence; 110 such cases were reviewed in FY2025. The compliance manager also scrutinizes contracts where counterparties either reject or propose amendments to the Anti-Corruption clause, which occurred in 87 instances during the fi- nancial year. Stakeholders can report con- cerns through dedicated, including anony- mous, channels, with all cases managed by the compliance officer and full protection en- sured for whistleblowers. MDR-A; G1-4 Actions and resources Upholding anti-corruption and anti-bribery principles remains a core element of Kernel’s approach to business conduct. In FY2025, no additional corrective actions were required due to the continuous improvements made as part of the compliance process. MDR-T Targets In line with our policies, we are committed to conducting business in a legal, ethical, and transparent manner. No targets are set for in- cidents of corruption and bribery, due to their context-dependent nature. Furthermore, we continuously monitor and assess our business conduct metrics, striving for year-on-year im- provement. Metrics G1-4 Incidents of corruption or bribery In FY2025, Kernel had no convictions or fines for violations of anti-corruption laws. G1-6 Payment practices Kernel’s payment practices are strictly regu- lated by commercial contracts with suppliers, which set a maximum period of 3 days within which the Group is obligated to pay. This clause applies to all suppliers; however, with small and medium-sized enterprises, which usually are producers of grain and oilseeds, Kernel aims to pay even sooner than required by contract. In FY2025, there were no legal proceedings for late payments. MDR-M Governance accounting methodology Incidents of corruption and bribery Data on incidents of corruption and bribery, as well as other compliance-related metrics, are consolidated and monitored by Kernel’s com- pliance officer. The Group’s HR Business Partners are responsible for data on employ- ees dismissed for corruption. Key anti-corruption and compliance indicators in FY2025 (as of 30 June) Number of confirmed incidents of corruption 66 Number of employees dismissed for corruption 43 Number of public legal cases on corruption brought against Kernel 0 Number of confirmed incidents of contracts with business partners being terminated due to corruption 1 Total number of submissions to Kernel’s channels of informing on misconduct 19 Total number of managers and specialists who completed the procedure on declara- tion of conflicts of interest 2,513 Total number of employees who took anti-corruption trainings 2,322 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 84 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements List of annexes Annex 1 – Statement on due diligence Core elements of due diligence Disclosure requirement a) Embedding due diligence in governance, strategy and business model SBM-3 GOV-2 GOV-3 b) Engaging with affected stakeholders in all key steps of the due diligence ESRS 2 IRO-1 ESRS 2 SBM-2 S1-1, S1-2 S3-1, S3-2 S4-1, S4-2 G1-1 ESRS 2 MDR-P/S1-1 ESRS 2 MDR-P/S3-1 ESRS 2 MDR-P/S4-1 c) Identifying and assessing adverse impacts ESRS 2 IRO-1 E1 SBM-3 E1 IRO-1 E2 IRO-1 E4 IRO-1; E4 SBM-3 E5 IRO-1 S1 SBM-3 S3 SBM -3 S4 SBM-3 G1 IRO-1 d) Taking actions to address those adverse impacts ESRS 2 MDR-A/E1-3 ESRS 2 MDR-A/E2-2 ESRS 2 MDR-A/E4-3 ESRS 2 MDR-A/E5-2 ESRS 2 MDR-A/S1-4 ESRS 2 MDR-A/S3-4 S3-3 ESRS 2 MDR-A/S4-4 S4-3 G1-1, G1-2, G1-3 e) Tracking the effectiveness of these efforts and communicating MDR-T/E1-4 E1-5, E1-6, E1-8 E2-4, E2-5 ESRS 2 MDR-T/E4-4 ESRS 2 MDR-T/E5-3 E5-5 ESRS 2 MDR-T/S1-5 S1-6, S1-9, S1-10, S1-16, S1-12, S1-13, S1-14, S1-15, S1-17 ESRS 2 MDR-T/S3-5 ESRS 2 MDR-T/S4-5 G1-4, G1-6 Annex 2 – List of data points that derive from other EU legislation Disclosure Requirement Datapoint SFDR reference Pillar 3 reference Benchmark Regulation reference EU Climate Law reference Material/ Not material Page ESRS 2 GOV-1 21 (d): Board's gender diversity Indicator number 13 of Table #1 of Annex 1 Commission Delegated Regulation (EU) 2020/1816, Annex II Material 91 ESRS 2 GOV-1 21 (e): Percentage of board members who are independent Delegated Regulation (EU) 2020/1816, Annex II Material 92 ESRS 2 GOV-4 30: Statement on due diligence Indicator number 10 Ta- ble #3 of Annex 1 Material 45; 84 ESRS 2 SBM-1 40 (d)i: Involvement in activities related to fossil fuel activities Indicators number 4 Ta- ble #1 of Annex 1 Article 449a; Regulation (EU) No 575/2013; Commission Implement- ing Regulation (EU) 2022/2453 Table 1: Qualitative infor- mation on Environmental risk and Table 2: Qualitative infor- mation on Social risk Delegated Regulation (EU) 2020/1816, Annex II Not material ESRS 2 SBM-1 40 (d)ii: Involvement in activities related to chemical production Indicator number 9 Table #2 of Annex 1 Delegated Regulation (EU) 2020/1816, Annex II Not material ESRS 2 SBM-1 40 (d)iii: Involvement in activities related to controversial weapons Indicator number 14 Ta- ble #1 of Annex 1 Delegated Regulation (EU) 2020/1818, Arti- cle 12(1) Delegated Reg- ulation (EU) 2020/1816, Annex II Not material ESRS 2 SBM-1 40 (d)iv: Involvement in activities related to cultivation and produc- tion of tobacco Delegated Regulation (EU) 2020/1818, Arti- cle 12(1) Delegated Reg- ulation (EU) 2020/1816, Annex II Not material ESRS E1-1 14: Transition plan to reach cli- mate neutrality by 2050 Regulation (EU) 2021/1119, Arti- cle 2(1) Material 51 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 85 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements List of annexes continued ESRS E1-1 16 (g): Undertakings excluded from Paris-aligned Benchmarks Article 449a; Regulation (EU) No 575/2013; Commission Implement- ing Regulation (EU) 2022/2453 Template 1: Banking book-Climate Change transition risk: Credit quality of expo- sures by sector, emis- sions and residual ma- turity Delegated Regulation (EU) 2020/1818, Arti- cle12.1 (d) to (g), and Ar- ticle 12.2 Not material ESRS E1-4 34: GHG emission reduction tar- gets Indicator number 4 Table #2 of Annex 1 Article 449a; Regulation (EU) No 575/2013; Commission Implement- ing Regulation (EU) 2022/2453 Template 3: Banking book – Cli- mate change transition risk: alignment metrics Delegated Regulation (EU) 2020/1818, Article 6 Material 51 ESRS E1-5 38: Energy consumption from fossil sources disaggregated by sources (only high climate impact sectors) Indicator number 5 Table #1 and Indicator n. 5 Ta- ble #2 of Annex 1 Material 54 ESRS E1-5 37: Energy consumption and mix Indicator number 5 Table #1 of Annex 1 Material 54 ESRS E1-5 40 to 43: Energy intensity associ- ated with activities in high climate impact sectors Indicator number 6 Table #1 of Annex 1 Material 54 ESRS E1-6 44: Gross Scope 1, 2, 3 and To- tal GHG emissions Indicators number 1 and 2 Table #1 of Annex 1 Article 449a; Regulation (EU) No 575/2013; Commission Implement- ing Regulation (EU) 2022/2453 Template 1: Banking book – Cli- mate change transition risk: Credit quality of ex- posures by sector, emis- sions and residual ma- turity Delegated Regulation (EU) 2020/1818, Arti- cle 5(1), 6 and 8(1) Material 55 ESRS E1-6 53 to 55: Gross GHG emissions intensity Indicators number 3 Ta- ble #1 of Annex 1 Article 449a; Regulation (EU) No 575/2013; Commission Implement- ing Regulation (EU) 2022/2453 Template 3: Banking book – Cli- mate change transition risk: alignment metrics Delegated Regulation (EU) 2020/1818, Arti- cle 8(1) Material 55 ESRS E1-7 56: GHG removals and carbon credits Regulation (EU) 2021/1119, Arti- cle 2(1) Not material ESRS E1-9 66: Exposure of the benchmark portfolio to climate-related physi- cal risks Delegated Regulation (EU) 2020/1818, Annex II Delegated Regulation (EU) 2020/1816, Annex II Not material ESRS E1-9 66 (a): Disaggregation of mone- tary amounts by acute and chronic physical risk 66 (с): Location of significant as- sets at material physical risk Article 449a; Regulation (EU) No 575/2013; Commission Implement- ing Regulation (EU) 2022/2453 para- graphs 46 and 47; Tem- plate 5: Banking book - Climate change physical risk: Exposures subject to physical risk. Not material ESRS E1-9 67 (c): Breakdown of the carrying value of its real estate assets by energy-efficiency classes Article 449a; Regulation (EU) No 575/2013; Commission Implement- ing Regulation (EU) 2022/2453 para- graph 34; Template 2: Banking book -Climate change transition risk: Loans col- lateralized by immovable property - Energy effi- ciency of the collateral Not material ESRS E1-9 69: Degree of exposure of the portfolio to climate- related op- portunities Delegated Regulation (EU) 2020/1818, Annex II Not material ESRS E2-4 28: Amount of each pollutant listed in Annex II of the E-PRTR Regulation (European Pollutant Release and Transfer Register) emitted to air, water and soil Indicator number 8 Table #1 of Annex 1 Indicator number 2 Table #2 of An- nex 1 Indicator number 1 Table #2 of Annex 1 Indi- cator number 3 Table #2 of Annex 1 Material 61 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 86 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements List of annexes continued ESRS E3-1 9: Water and marine resources Indicator number 7 Table #2 of Annex 1 Not material ESRS E3-1 13: Dedicated policy Indicator number 8 Table 2 of Annex 1 Not material ESRS E3-1 14: Sustainable oceans and seas Indicator number 12 Ta- ble #2 of Annex 1 Not material ESRS E3-4 28 (с): Total water recycled and reused paragraph Indicator number 6.2 Ta- ble #2 of Annex 1 Not material ESRS E3-4 29: Total water consumption in m3 per net revenue on own oper- ations Indicator number 6.1 Ta- ble #2 of Annex 1 Not material ESRS 2-SBM 3-E4 16 (a)i Indicator number 7 Table #1 of Annex 1 Material 63 ESRS 2-SBM 3-E4 16 (b) Indicator number 10 Ta- ble #2 of Annex 1 Not material ESRS 2-SBM 3-E4 16 (c) Indicator number 14 Ta- ble #2 of Annex 1 Not material ESRS E4-2 24(b): Sustainable land, agricul- ture practices or policies Indicator number 11 Ta- ble #2 of Annex 1 Material 64 ESRS E4-2 24(с): Sustainable oceans/seas practices or policies Indicator number 12 Ta- ble #2 of Annex 1 Not material ESRS E4-2 24 (d): Policies to address defor- estation Indicator number 15 Ta- ble #2 of Annex 1 Material 64 ESRS E5-5 37 (d): Non-recycled waste Indicator number 13 Ta- ble #2 of Annex 1 Material 68 ESRS E5-5 39: Hazardous waste and radio- active waste Indicator number 9 Table #1 of Annex 1 Material 68 ESRS 2-SBM3-S1 14 (f): Risk of incidents of forced labour Indicator number 13 Ta- ble #3 of Annex I Not material ESRS 2-SBM3-S1 14 (g): Risk of incidents of child labour Indicator number 12 Ta- ble #3 of Annex I Not material ESRS S1-1 20: Human rights policy commit- ments Indicator number 9 Table #3 and Indicator number 11 Table #1 of Annex I Material 69-70; 87 ESRS S1-1 21: Due diligence policies on is- sues addressed by the funda- mental International Labor Or- ganisation Conventions 1 to 8 Delegated Regulation (EU) 2020/1816, Annex II Material 69 ESRS S1-1 22: processes and measures for preventing trafficking in human beings Indicator number 11 Ta- ble #3 of Annex I Not material ESRS S1-1 23: workplace accident preven- tion policy or management sys- tem Indicator number 1 Table #3 of Annex I Material 69-70; 87 ESRS S1-3 32 (с): grievance/complaints han- dling mechanisms Indicator number 5 Table #3 of Annex I Material 81 ESRS S1-14 88 (b) and (с): Number of fatali- ties and number and rate of work-related accidents Indicator number 2 Table #3 of Annex I Delegated Regulation (EU) 2020/1816, Annex II Material 74 ESRS S1-14 88 (e): Number of days lost to in- juries/ accidents/ fatalities or ill- ness Indicator number 3 Table #3 of Annex I Material 74 ESRS S1-16 97 (a): Unadjusted gender pay gap paragraph Indicator number 12 Ta- ble #1 of Annex I Delegated Regulation (EU) 2020/1816, Annex II Not material ESRS S1-16 97 (b): Excessive CEO pay ratio paragraph Indicator number 8 Table #3 of Annex I Not material ESRS S1-17 103 (a): Incidents of discrimina- tion paragraph Indicator number 7 Table #3 of Annex I Not material ESRS S1-17 104 (a): Non-respect of UNGPs on Business and Human Rights and OECD Guidelines Indicator number 10 Ta- ble #1 and Indicator n. 14 Table #3 of Annex I Delegated Regulation (EU) 2020/1816, Annex II Delegated Regulation (EU) 2020/1818 Art 12 (1) Not material ESRS 2-SBM3-S2 11 (b): Significant risk of child la- bour or forced labour in the value chain Indicators number 12 and n. 13 Table #3 of Annex I Not material ESRS S2-1 17: Human rights policy commit- ments Indicator number 9 Table #3 and Indicator n. 11 Ta- ble #1 of Annex 1 Not material ESRS S2-1 18: Policies related to value chain workers Indicator number 11 and n. 4 Table #3 of Annex 1 Not material ESRS S2-1 19: Non-respect of UNGPs on Business and Human Rights principles and OECD guidelines Indicator number 10 Ta- ble #1 of Annex 1 Delegated Regulation (EU) 2020/1816, Annex II Delegated Regulation (EU) 2020/1818, Art 12 (1) Not material ESRS S2-1 19: Due diligence policies on is- sues addressed by the funda- mental International Labor Or- ganisation Conventions 1 to 8 Delegated Regulation (EU) 2020/1816, Annex II Not material ESRS S2-4 36: Human rights issues and inci- dents connected to its upstream and downstream value chain Indicator number 14 Ta- ble #3 of Annex 1 Not material ESRS S3-1 16: Human rights policy commit- ments Indicator number 9 Table #3 of Annex 1 and Indica- tor number 11 Table #1 of Annex 1 Material 76; 87 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 87 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements List of annexes continued ESRS S3-1 17: Non-respect of UNGPs on Business and Human Rights, ILO principles or OECD guidelines Indicator number 10 Ta- ble #1 Annex 1 Delegated Regulation (EU) 2020/1816, Annex II Delegated Regulation (EU) 2020/1818, Art 12 (1) Material 76 ESRS S3-4 36: Human rights issues and inci- dents Indicator number 14 Ta- ble #3 of Annex 1 Material 77 ESRS S4-1 16: Policies related to consumers and end-users Indicator number 9 Table #3 and Indicator number 11 Table #1 of Annex 1 Material 79 ESRS S4-1 17: Non-respect of UNGPs on Business and Human Rights and OECD guidelines Indicator number 10 Ta- ble #1 of Annex 1 Delegated Regulation (EU) 2020/1816, Annex II Delegated Regulation (EU) 2020/1818, Art 12 (1) Not material ESRS S4-4 35: Human rights issues and inci- dents Indicator number 14 Ta- ble #3 of Annex 1 Material 79 ESRS G1-1 10 (b): United Nations Conven- tion against Corruption Indicator number 15 Ta- ble #3 of Annex 1 Not material ESRS G1-1 10 (d): Protection of whistle-blow- ers Indicator number 6 Table #3 of Annex 1 Not material ESRS G1-4 24 (a): Fines for violation of anti- corruption and anti-bribery laws Indicator number 17 Ta- ble #3 of Annex 1 Delegated Regulation (EU) 2020/1816, An- nex II) Material 83 ESRS G1-4 24 (b): Standards of anti- corrup- tion and anti- bribery Indicator number 16 Ta- ble #3 of Annex 1 Material 83 Annex 3 – Key Policies and Procedures Policy Description of key contents Scope Responsible for implementation Internationally recognized instruments Availability Sustainable Development and CSR Policy The Policy is built around commitment to three dimensions: social, eco- nomic, and environmental responsibility — all contributing to sustainable development and the achievement of strategic objectives. Social responsibility focuses on developing human potential, ensuring occupational health and safety, fostering opportunities for self- realization and professional growth, and contributing to the resolution of socially sig- nificant issues, including support for local communities in regions of op- eration. Economic responsibility is aimed at maximizing profitability through the efficient use of resources, adoption of innovative technologies, continu- ous process improvement, and transparent business practices. The Com- pany is committed to responsible land use and to producing high-qu ality products that meet international standards, business ethics, and cus- tomer needs. Environmental responsibility prioritizes energy efficiency, minimizing environmental impacts, reducing greenhouse gas emissions, increasing recycling and waste minimization, and preserving soil health and natural regenerative capacity. Group Value chain Head of Sustainable Devel- opment Head of CSR SDGs UN Global Compact Corporate website Environmental Protection Policy The Policy sets out goals to prevent and minimize negative impacts on the environment, ensure effective management of environmental risks, and establish a unified approach to environmental management. It em- phasizes continuous improvement and performance enhancement in en- vironmental protection, developing systems for monitoring environmental impacts, and ensuring openness and transparency in environmental com- munications. Group Value chain Head of Environmental Pro- tection Head of Sustainable Devel- opment ISO 14001 National legislation Corporate website Human Rights Policy The Policy establishes guiding principles for the Company’s approach to human rights, decision- making, and expected behavior. It aims to foster a strong compliance culture and uphold ethical standards in employee relations, while ensuring respect for human rights and providing effective remedies in cases of violation. The Policy ensures that all universally rec- ognized human rights are upheld within the Company, demonstrates that respect for rights and freedoms is fundamental to business resilience, and sets out concrete actions to make these principles clear to employees and partners. Group Value chain Head of Compliance Depart- ment UN Guiding Principles on Business and Human Rights ILO Fundamental Conven- tions OECD Guidelines National legislation Corporate website Stakeholder Engagement Policy The Policy defines Kernel’s commitment to building transparent, con- structive, and long-term relationships with its stakeholders. It defines a Stakeholder Engagement Plan, which tailors engagement methods for each stakeholder group and outlines their key concerns, the approaches used to address them, and the outcomes we aim to achieve. The policy emphasizes contribution to sustainable regional development, grievance mechanisms for confidential feedback, transparent communi- cation on follow- up actions, and continuous improvement through regular evaluation and benchmarking of engagement practices. Group Head of CSR Head of Sustainable Devel- opment Directors of the Division/De- partment Heads Aarhus Convention Corporate intranet DE&I Policy The Policy aims to ensure equal respect and unbiased treatment for peo- ple of all cultures, backgrounds, and positions across the Group. It pro- motes equality, inclusion, and diversity, fostering human dignity and zero tolerance for discrimination. By creating opportunities, empowering un- derrepresented groups, and removing barriers for youth, women, people with disabilities, those nearing retirement, and employees from diverse regions, the Policy advances inclusivity. Group Value chain Head of Human Resources Department UN Global Compact UN SDGs UN Entity for Gender Equality and the Empowerment of Women and International La- bor Organization Conven- tions Corporate website Anti-discrimination Policy The Policy outlines the company’s commitment to preventing discrimina- tion and unlawful harassment, protecting employees, counterparties, cus- tomers, and stakeholders. It reinforces the creation of a safe, diverse, and Group Value chain Head of Human Resources Department UN Global Compact Corporate website Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 88 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements List of annexes continued respectful workplace where all individuals are treated with dignity. It en- sures that all stakeholders are aware of the Policy, with clear procedures to properly investigate and address any allegations of violations. Occupational Health and Safety (OHS) Policy The Policy is aimed at creating a safe working environment, fostering a strong safety culture, and implementing measures to protect the health and lives of employees during their professional activities. The Policy fo- cuses on identifying and eliminating ha zards, managing related risks, and ensuring the efficient operation of assets through continuous improve- ment of the OHS system. Key measures include analyzing incidents and implementing corrective actions, reducing risks to personnel during mili- tary aggres sion, monitoring OHS performance indicators and reporting on results, and providing psychosocial support to employees to help prevent mental and behavioral disorders. Group Head of Occupational Safety Department OHSAS 18001/ISO 45001 National legislation Corporate intranet Compensation and Benefits Policy The Policy is designed to ensure fair compensation for employees based on their qualifications, performance, and contribution to the Company’s goals. The Policy promotes external fairness by aligning remuneration levels with market standards, while also en suring transparency and clarity of reward conditions for all employees. It aims to motivate staff to achieve strategic objectives, while creating the conditions necessary to attract and retain talented employees. Group Head of Human Resources Department Directors of the Division/De- partment Heads National legislation Corporate intranet Security Policy The Policy is aimed at ensuring the safety and protection of its people, assets, and operations. The Policy establishes effective measures to pre- vent, monitor, and respond to security risks, including those arising from external threats, while maintaining business continuity. Group Head of Security Department - Corporate intranet Resilience in Times of War Policy The Policy is designed to ensure the uninterrupted operation of the Group, maintain financial stability, protect employees and assets, pro- mote social responsibility, and comply with legal and ethical standards during times of war. It establishes measures for maintaining critical busi- ness processes, developing emergency response plans, securing finan- cial reserves, and supporting employees through training, adaptation, and timely communication. Beyond internal resilience, the Policy encourages volunteer and charity initiatives, supporting communities in rebuilding in- frastructure and addressing urgent needs. Group Head of Human Resources Department Directors of the Division/De- partment Heads - Corporate intranet Policy of Working with Veterans The Policy is designed to support the professional and social reintegration of veterans. It aims to create favorable conditions for the return of demo- bilized employees and the recruitment of veteran candidates, promoting their integration into society and professional life, and fostering an inclu- sive workplace that ensures both comfort and productivity. Group Head of Human Resources Department National legislation Corporate intranet Social Impact and Community Engagement Policy The Policy sets out Kernel’s commitment to creating lasting positive out- comes in the regions where it operates. It defines the principles of social influence and cooperation with communities, ensures transparent and systematic management of engagement with local authorities and stake- holders, and establishes effective mechanisms for addressing social is- sues together. The policy guides the implementation of long- term social programs and projects that contribute to sustainable regional develop- ment, while promo ting a unified approach to collaboration that delivers lasting results for both the Company and the communities it serves. Group Head of CSR UN Global Compact UN Guiding Principles on Business and Human Rights Corporate intranet Safety and Quality Man- agement Policy The Policy aims to ensure proper control at all key stages of the produc- tion process, from the purchase of raw materials through their handling, storage, and processing to the production of finished products and their shipment, in accordance with establish ed procedures, regulations, and instructions. It promotes the use of advanced methods for quality assess- ment, thorough documentation of laboratory quality control processes, and the implementation of motivational strategies to foster high- quality, productive, and engaged employee performance. Group Value chain Head of Quality Management ISO standards FSSC 22000 IFS standards GMP +1B, +B3, +B4 ISCC standards National legislation Corporate website Code of Conduct The Code of Conduct reflects Kernel’s core values and guiding principles, setting the foundation for responsible and sustainable business practices. It emphasizes financial stability, strategic system management, and the effective use of assets and resourc es, while fostering synergy through business integration and innovation. It promotes sustainable business reputation - transparency, honesty, and compliance with laws and regu- lations, alongside a commitment to sustainable development, social re- sponsibility , workplace health, and environmental stewardship. The Code recognizes the importance of strong leadership, professional teams, and entrepreneurial involvement, guided by partnership, shared goals, mutual respect, and trust. Group All employees UN Guiding Principles on Business and Human Rights National legislation Corporate website Corporate Governance Charter The Corporate Charter outlines the principles and framework guiding Ker- nel’s corporate management and operations. It sets out the roles of share- holders, the Board, and executive management, outlines the work of key committees, and establishes principles for financial reporting, risk man- agement, disclosure, and sustainability. Group Board of Directors Executive Management Team Best Practices for WSE Listed Companies 2021 The X Principles of Corporate Governance of the Luxem- bourg Stock Exchange Corporate website Code of Interaction with Suppliers The Code establishes clear standards for fair business practices, respect for human rights and environmental responsibility with suppliers. Kernel builds supplier relationships on openness, trust, and integrity by holding transparent tenders, ensuring equa l treatment, and providing channels to report violations. Suppliers are required to maintain fair working condi- tions, prohibit child and forced labor, prevent discrimination and harass- ment, uphold health and safety standards, and respect cultural diversity and freedom of association. The Code also emphasizes minimizing envi- ronmental impact, maintaining sustainable and efficient operations, deliv- ering high- quality products and services, and safeguarding confidential information and personal data. Compliance with these principles is sub- ject to verification, and violations may result in exclusion from tenders, termination of contracts, or cessation of cooperation. Group Value chain All employees - Corporate website Conflict of Interest Man- agement and the Pre- vention of Fraud and Corruption Policy The Policy is designed to foster a strong compliance culture and protect the Company from risks related to conflicts of interest, fraud, and corrup- tion. It defines the types of conflicts of interest and situations requiring resolution, as well as the mecha nisms for addressing them. The policy Group CEO Directors of the Division/De- partment Heads FCPA UKBA UNCAC Corporate intranet Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 89 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements List of annexes continued also outlines clear rules for tenders and procurement, interactions with public officials, the handling of business gifts and hospitality, financial re- porting standards, and procedures for reporting violations, ensuring in- tegrity and transparency across all business operations. The Convention on Combat- ing Bribery of Foreign Public Officials in International Busi- ness Transactions OECD Convention Protection of Whistle- blowers Procedure The Procedure is designed to safeguard employees who report concerns by preventing workplace discrimination against whistleblowers and their close relatives employed within the Company. The procedure is covered by Conflict of Interest Management and the Prevention of Fraud and Cor- ruption Policy. It establishes measures to avoid harassment or violations of whistleblowers’ rights, provides guidance on appropriate behavior in cases of confirmed retaliation, and reduces risks associated with potential misuse of authority by managers. Group Head of Compliance Depart- ment - Corporate intranet Sanctions Policy The Policy establishes Kernel’s commitment to monitoring, assessing, and managing sanctions- related risks across all business operations. Its purpose is to protect the Company’s reputation, avoid cooperation with parties subject to international or nationa l sanctions, and safeguard against related financial, operational, and legal risks while ensuring busi- ness continuity. Group Valur chain Head of Compliance Depart- ment National legislation Corporate website Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 90 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Corporate Governance Main characteristics of Kernel Group structure Kernel Holding S.A. (the “Company”) is a Lux- embourg-based public limited liability com- pany (RCS Luxembourg B109173) estab- lished on 15 June 2005, with its registered of- fice at 8A, Boulevard Joseph II, L-1840 Lux- embourg. It serves as the holding entity for a group of companies, collectively referred to as the “Group” or “Kernel”. The list of primary subsidiaries is disclosed on page 114 of this report. Listing on the WSE The Company's shares have been listed on the main market of the Warsaw Stock Ex- change (“WSE”) since November 2007. On 13 April 2023, the Board of Directors de- cided to delist the Company from the WSE, and on 12 May 2023, the Company applied to the Polish Financial Supervision Authority (“PFSA”) for approval. On 13 October 2023, the group of minority shareholders of the Company initiated legal proceedings to cancel the Board’s delisting decision. Given that, in March 2024, the PFSA informed the Company about the suspension of the administrative proceedings on the delisting of the Company from the Warsaw Stock Exchange. The PFSA will not issue the decision on granting permission to withdraw the Company's shares from trading on the reg- ulated market until the District Court in Luxem- bourg has resolved the allegations raised by minority shareholders. Consequently, the pro- cess of the Kernel’s delisting from the WSE was ongoing as of 30 June 2025. Share capital and significant share- holdings The issued capital of the Company as of 30 June 2025 consisted of 293,429,230 fully paid ordinary single-class shares without indication of the nominal value. Ordinary shares have equal voting rights and rights to receive divi- dends. According to notifications received by the Company, one shareholder owned more than 5% of the Company’s voting shares as of 30 June 2025: • Namsen Limited (hereinafter “Namsen”), a legal entity directly controlled by the Chairman of the Board of Directors and founder of the business, Mr. Andrii Ver- evskyi, owns 95.07% of voting shares. Over the course of FY2025, Namsen in- creased its stake in the Company from 94.4% to 95.07% of total shares issued, as a result of the acquisition of shares, as disclosed in the Current report no. 02/2025. As of 30 June 2025, the Company held 300,000 shares as treasury stock without vot- ing and dividend rights, representing 0.1% of the subscribed share capital. The increase in the treasury shares during FY2025 resulted from a transaction under the long-term man- agement incentive plan, whereby one benefi- ciary exercised a put option to sell a fixed num- ber of the Company’s shares back to the Com- pany at the predetermined exercise price. The total cash consideration paid amounted to USD 6.6 million. As of 30 June 2025, there were no outstanding options granting rights to acquire shares of the Company to which the Company is a party. Corporate governance framework Kernel is committed to high standards of cor- porate governance and is guided by the cor- porate governance framework determined by: • the corporate law of the Grand Duchy of Luxembourg as a place of incorporation (in- cluding voluntary compliance with most of the provisions of the X Principles of Corpo- rate Governance of the Luxembourg Stock Exchange); and • the corporate governance rules set out in the Best Practice for WSE Listed Compa- nies 2021 as a place of Company’s shares listing. Paragraph 29 of the Warsaw Stock Exchange Rules requires issuers to publish a report indicating which rules the issuer complies with and which rules the issuer does not comply with permanently. The Company published such a report on 12 Au- gust 2021, available on the Company’s website. The Company applied all the prin- ciples except for detailed principles 1.4., 1.4.1., 1.4.2., 1.5., 2.1., 2.11.3., 2.11.5., 2.11.6., 3.6., 3.9., 6.2., 6.3., 6.4. The key documents defining the Company’s corporate governance principles include the Articles of Association and the Corporate Gov- ernance Charter. Additionally, Kernel has a Remuneration Policy, which is approved and periodically reviewed by the general meeting of shareholders and applies to both the Board of Directors and the Executive Management Team. All these documents can be accessed on the Company’s website. Following a regular review of the Company’s ……………………………………………………………………... Ownership structure as of 30 June 202 5 Shares owned % owned % of voting /dividend Namsen 278,947,016 95.07% 95.16% Other 14,182,214 4.83% 4.84% Treasury 300,000 0.10% 0.00% Total 293,429,230 100.0% 100.0% …………………………………………………………………………………………………………………………………………………. Sell-out On 28 January 2025, the Company received a notification from Namsen Limited about the manager's transactions that occurred on 27 January 2025. As a result of these transactions, Namsen Limited acquired 2,032,127 Company's shares at a price of EUR 3.93 per share, thereby increasing its total shareholding to 278,947,016 shares of Kernel Holding S.A., repre- senting 95.07% of total shares issued and voting rights. Consequently, Namsen has become the majority shareholder within the meaning of the Lux- embourg Law of 21 July 2012 on mandatory squeeze-out and sell-out of securities of compa- nies currently admitted or previously admitted to trading on a regulated market or having been offered to the public and amending the law of 23 December 1998 establishing a financial sector supervisory commission. On 29 July 2025, the Company received a notification from Namsen that 1) certain minority shareholder had decided to exercise their right to sell their shares, thereby initiating the sell- out procedure; 2) KPMG prepared the valuation report to determine the fair price of Company’s shares; 3) Namsen proposed price of PLN 19.45 per shares to be used in the sell-out. As of the date of this report, no further updates or decisions have been communicated by the Commission de Surveillance du Secteur Financier regarding the fair price or next steps in the sell-out procedure. ...................................................................................................……………………..................................................................................................... Governance structure Executive Management Team Board of Directors • Audit Committee • Sustainability Committee • Nomination and Remu- neration Committee General meeting of shareholders Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 91 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Corporate Governance continued adherence to the best corporate governance practices, the Board believes that the Com- pany has made its best efforts to comply with: • the applicable corporate governance princi- ples; • disclosure obligations concerning compli- ance with corporate governance principles defined in the WSE Rules; • regulations on current and periodic reports published by the Company as a securities issuer, according to WSE Rules. General Meeting of Sharehold- ers The General Meeting of Shareholders is the Company's highest governance body, pos- sessing the broadest power to order, carry out, or ratify all acts relating to the Company's op- erations. Detailed information on the organiza- tion and functioning of the General Meeting of Shareholders can be found in the Articles of Association and the Corporate Governance Charter, both of which are available on the Company’s website. To safeguard the Company’s corporate gov- ernance framework and mitigate legal uncer- tainty, an extraordinary general meeting of shareholders was held on 12 August 2024 to reapprove all the resolutions adopted at the annual general meeting of shareholders held on 11 December 2023 (the “AGM 2023”). This precautionary step was taken in response to legal actions initiated by shareholders repre- senting approximately 0.4% of the Company’s share capital. Among other things, they seek to suspend the effects of the minutes of the AGM 2023 and annul the decisions taken. Such frivolous litigations might have had a negative impact on Kernel, including disrup- tion to the Company’s orderly operations, po- tentially complicating both reporting and audit- ing processes and/or creating a vacuum of corporate powers at some stage. As a precau- tionary measure, shareholders were invited to vote again on each agenda item. This was to either maintain the effect of their vote ex- pressed at the AGM 2023 (if applicable) or to cast a new vote on each agenda item (if no vote was expressed at the AGM 2023 or they wished to change their previous vote). The annual general meeting held on 10 De- cember 2024 (the “AGM 2024”): • approved the management report of the Board of Directors, the consolidated finan- cial statements of the Group, and the standalone annual accounts of the Com- pany, along with the report of the independ- ent auditor for the year ended 30 June 2024; • approved, on an advisory basis, the remu- neration report for the FY2024; • granted discharge to the directors of the Company for their mandates in FY2024; • renewed the mandates of all directors and approved the fees for executive and non-ex- ecutive directors for the year ended 10 De- cember 2025; • re-appointed PwC as the independent audi- tor of the Company; All recent general meetings were held with the physical presence of shareholders, alongside through the direct electronic voting and proxy voting via an independent representative. The next annual general meeting of share- holders is scheduled for 10 December 2025. All documents related to the general meetings of shareholders and the resolutions adopted are available on the Company’s website. GOV-1 Board of Directors The Company is managed by the Board of Di- rectors (the “Board”), which is the ultimate de- cision-making body, except for powers re- served for the general meeting of sharehold- ers as stipulated by law, the Articles of Asso- ciation, and the Corporate Governance Char- ter. The Board is vested with the broadest powers to perform all acts of administration and disposition in compliance with the Com- pany’s corporate purpose. The Board resolves to take its decisions objectively, in the best corporate interest of the Company. The Board is collectively responsible and accountable to the shareholders for the proper conduct of the business, the long-term success of the Com- pany, the effectiveness of the reporting sys- tem, and the corporate governance frame- work. The responsibilities of the Board include ap- proval and review of strategies and policies, governance of the Company, and manage- ment supervision. More detailed responsibili- ties are specified in the Company’s Corporate Governance Charter. All Directors are equally accountable for the proper stewardship of the Company’s affairs. The non-executive directors have a responsi- bility to ensure that the business strategies proposed are fully discussed and critically re- viewed. This enables the Directors to promote the success of the Company for the benefit of its shareholders, while having regard to, among other matters, the interest of employ- ees, the fostering of business relationships with customers, suppliers, and other stake- holders, as well as promoting the impact of the Company’s operations on the communities and the environment in which the business op- erates. The Board approves every investment, divest- ment, acquisition, disposal, and funding trans- action exceeding in value 5% of the average 12 months trailing daily market capitalization of the Company. Board composition The Board is composed of eight directors, five of which are executive (including a Chairman) and three are non-executive directors. There were no changes in the composition of the Board in FY2025. Our non-executive directors are highly experi- enced and influential, with diverse back- grounds across various industries and coun- tries. They bring a strong blend of skills and business acumen, significantly enhancing the effectiveness of the Board and its Commit- tees. ……………………………………………………………………………………………………………………………………….......................................................................................................................... Composition of the Board of Directors as of 3 October 2025 75% 25% Male Female Gender 13% 75% 13% <40 41-50 >50 Age 50% 13% 38% <5 years 5-10 years >10 years Tenure Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 92 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Corporate Governance continued ...................................................................................................……………………........................................................................................................................................................................................................................ Effective and experienced leadership Kernel Holding S.A. is governed by the Board of Directors composing of eight members, including three non-executive directors, two of whom are independent. Key information on Directors is as follows (with further details available on Company’s website). Andrii Verevskyi, 5 1 Chairman of the Board, Founder Andrii Miski-Oglu, 48 Independent non-executive director Tenure: 18 years Skills and experience: Founded the Group’s business in 1995, holding various executive positions within the Group. Presently, he over- sees the strategic development and overall management of the Group. Board Committee: Nomination & Remuneration Commit- tee Tenure: 4 years Skills and experience: Mr. Miski-Oglu has 21 years of experi- ence in public accounting and audit at EY, involved in major EY Global audit - related initiatives. He holds CPA in the US since 2011 and a member of The American Institute of Certified Public Accountants (AICPA). Board Committee: Chairman of the Audit Committee, Nomination & Remu- neration Committee Daria Danilczuk, 38 Non-executive director Mykhaylo Mishov, 43 Independent non-executive director Tenure: 4 years Skills and experience: Agricultural commodity broker, special- ized in Black Sea commodity markets, experienced in international trade and biofuels trade and regulatory frame- work. Board Committee: Chairwoman of the Sustainability Com- mittee, Audit Committee Tenure: 4 years Skills and experience: Mr. Mishov has over 18 years’ experi- ence in consulting, including Ernst & Young, Deloitte and KPMG, leading nu- merous strategy and performance im- provement projects for agribusiness cli- ents. Board Committee: Chairman of the Nomination & Remu- neration Committee, Audit Committee, Sustainability Committee Sergiy Volkov, 45 Chief Financial Officer Yevgen Osypov, 49 Chief Executive Officer Tenure: 2 years Skills and experience: Mr. Volkov is responsible for the overall financial management of Kernel. He holds CPA certification. Board Committee: None Tenure: 8 years Skills and experience: Mr. Osypov is responsible for the day - to- day management of the Company’s subsidiaries, execution of strategy, budgets, and Board decisions. He com- pleted several educational programs in Harvard Business School. Board Committee: Sustainability Committee Anastasiia Usachova, 54 Executive Director Yuriy Kovalchuk, 44 Corporate Investment Director Tenure: 18 years Skills and experience: Mrs. Usachova is responsible for the overall financial oversight of Kernel. She holds an MBA degree from IMD (Switzerland). Board Committee: Sustainability Committee Tenure: 14 years Skills and experience: Mr. Kovalchuk contributes to strategy formulation and is responsible for the execution of investment projects. Yuriy has been a Fellow with Association o Chartered Certified Accountants (FCCA), since September 2013. Board Committee: None Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 93 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Corporate Governance continued All directors’ mandates, including that of the Chairman, expires at the Annual General Meeting in December 2025. The Nomination & Remuneration Committee regularly reviews the Board’s composition to ensure a diverse, balanced mix of competen- cies, skills, experience, and knowledge of the Company’s affairs. Key principles for the nom- ination, appointment, and re-election of Direc- tors are outlined in the Corporate Governance Charter, available on Kernel’s website. Board diversity Diversity among Directors enhances the Board's performance and efficiency, serving the Company’s best interests. The Board's di- versity is supported by Kernel’s Diversity, Equality, and Inclusion Policy, adopted by management in 2018 and approved by the AGM on 10 December 2021. The policy is con- sistently applied by the Nomination & Remu- neration Committee and the Executive Man- agement Team in employee and management appointments. The Company benefits from diversity in: • gender; • age and tenure; • professional experience (industry and op- erations expertise, soft commodities trad- ing, finance and audit, banking and invest- ments, and sustainability); • nationality and culture (the Board in- cludes citizens of Ukraine, along with one Luxembourg resident, one Polish citizen, and two U.S. citizens). Directors consider diversity when evaluating the Board's effectiveness. In the FY2025 an- nual self-evaluation, all Directors acknowl- edged the Board’s sufficient range of exper- tise, attitudes, and external relationships. Directors’ independence Each independent director annually submits a statement confirming compliance with the in- dependence criteria outlined in Annex II of the European Commission Recommendation of 15 February 2005. These statements are pub- lished on the Company’s website. According to statements received in 2025, two of the three non-executive directors met the in- dependence criteria. None of the three non- executive directors have any material relations with shareholder holding at least 5% of the Company’s total voting rights. Conflict of interest A Corporate Governance Charter adopted in May 2018 emphasized the disclosure of con- flicts of interest among Directors. Any Director having a direct or indirect conflict of interest must inform the Board thereof and shall refrain from deliberating or voting on the relevant item on the agenda. Any conflict of interest should be properly declared and documented. Members of the Board shall refrain from pro- fessional or other activities which might cause a conflict of interest or adversely affect their reputation as members of the governing bod- ies of the Company, and where a conflict of interest arises, immediately disclose it. The following non-exhaustive list is an exam- ple of the duties that shall be followed by the Directors: • duty not to accept any benefits from third parties, which may give rise to personal fi- nancial interest and/or gain; • duty to disclose any interest in a proposed transaction or arrangement with the Com- pany and a separate and independent duty to disclose any arrangement with the Com- pany; and • duty to avoid conflicts of interest unless au- thorized. There were no cases of conflict of interest among Directors declared over the course of FY2025. As of October 2025, non-executive directors occupied the following positions in companies outside Kernel: • Mrs. Daria Danilczuk is a commodities bro- ker and trading expert at JDI Brokers, Swit- zerland. • Mr. Mykhaylo Mishov is Supply Chain Strat- egy Lead at SC Johnson, Chicago, United States. • Mr. Andrii Miski-Oglu does not occupy posi- tions in companies outside Kernel as of the date of publication of this report. Board committees The Board has established three committees: • Audit Committee; • Nomination & Remuneration Committee (hereinafter “N&R Committee”); • Sustainability Committee. This structure ensures efficient performance, as specific matters are first discussed by spe- cialized bodies with relevant expertise before being presented to the Board. The Board regularly reviews the need for new committees to adapt to changing business needs. Following the annual review in July 2025, it was concluded that no new commit- tees are needed at this time. Board self-evaluation In line with the best corporate governance standards, the Board conducts a formal self- evaluation of its performance, effectiveness, operating efficiency, composition, organizational structure, compliance with gov- ernance rules, and relationships with execu- tive management and stakeholders. The 2025 survey found no major issues in these areas. The Board recognized the quality and timeli- ness of information provided, the effective- ness of its practices and meetings, appropri- ate composition, clearly defined roles, and well-established committee practices. During the year, the non-executive directors convened without the participation of execu- tive directors to assess the performance of the executive directors and the Executive Man- agement Team, review progress against stra- tegic objectives, and evaluate the Group’s po- sition within the sector and market. The prac- tice of convening such meetings forms an in- tegral part of the Board’s governance frame- work, enabling the non-executive directors to exercise independent judgment, provide con- structive challenge to executive leadership, and ensure that oversight of performance re- mains robust. Professional development To ensure that Directors maintain the skills and knowledge necessary to effectively con- tribute to the Board’s discussions, the Group’s Human Resources Director engages with Di- rectors to determine and agree upon individual training and development requirements. During FY2025 the Directors undertook tar- geted professional development programs tai- lored to their specific roles and responsibili- ties, including: • Andrii Miski-Oglu – Audit Committees in a New Era of Governance (Harvard Business School): enhancing understanding of evolv- ing regulatory requirements, strengthening internal controls, risk management, and fos- tering transparency with investors; • Daria Danilczuk-Masri – Wharton ESG Ex- ecutive Certificate for Senior Leaders: deepening expertise in developing and im- plementing ESG strategies aligned with business goals, engaging key stakeholders, managing ESG-related risks, and measur- ing performance. Independent advice All directors can consult the corporate secre- tary for assistance with governance, corporate administration, and legal matters. Directors may also seek advice from independent pro- fessional advisors on governance or business- related issues pertinent to their duties, at the Company’s expense. Board activity report The Board held fifteen meetings in FY2025, in- cluding two in-person meeting in Luxembourg and thirteen via teleconference. The average attendance rate for all directors was 88% Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 94 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Corporate Governance continued during this period. Typically, at each meeting, the Chairman of the Board and other executive directors report on the strategy implementation and recent de- velopments, along with management ac- counts. The Board’s work plan (minutes and circular resolutions) for FY2025 included, among others, the following items: • review of the impact of the Russia-Ukraine war on operations; • review of the Company’s strategy and budget approval; • review and approval of annual, semi-an- nual, and quarterly accounts; • review of operations updates and manage- ment accounts; • convening annual and extraordinary gen- eral meetings of shareholders; • review of corporate-governance-related questions; • oversight of risk management: approval of top risks for the Company and mitigation plan, review of reports on top risks mitiga- tion activities; update on implementing the risk management system; review of risk lim- its; • review of outstanding legal cases; • updates from Audit Committee, N&R Com- mittee, and Sustainability Committee; • review of the performance of the Group sus- tainability function; • review and approvals of financing and in- vestment transactions; • various ad-hoc items and other corporate decisions. Executive Management Team The Executive Management Team is respon- sible for the overall financial and operating re- sults of the Company’s subsidiaries, heading operating segments and providing support functions on a daily basis. The Executive Man- agement Team focuses on strategy imple- mentation, financial and competitive perfor- mance, commercial and technological devel- opments, succession planning, and organiza- tional development. The Executive Management Team is headed by the Chief Executive Officer (the “CEO”), who is appointed and removed by the Board and reports directly to it. The CEO is respon- sible for the day-to-day management of the Company’s subsidiaries, execution of strat- egy, budgets, and Board decisions. The CEO delegates his/her responsibilities to the other members of the Executive Management Team. The Executive Management Team consists of 15 professionals including the CEO, benefiting from the diversity among its members. All the members of the Executive Management Team other than the CEO are appointed and removed, as applicable, by the Board upon proposal by the N&R Committee after prior consultation with the CEO, save where he is subject to the procedure. As such, after the re- porting date, in August 2025, the Board: • acknowledged the transition of Mr. Yurii Pu- hach from his mandate as Director, Produc- tion Assets Management (as a member of the Executive Management Team) to Pro- ject Manager (a role outside the Executive Management Team) with effect as of 19 Au- gust 2025; • acknowledged the transition of Mr. Oleg Tkachenko from his mandate as Director, Security (as a member of the Executive Management Team) to a new role responsi- ble for Capital Construction (a role outside the Executive Management Team) with ef- fect as of 26 August 2025; • resolved to appoint Mr. Hryhorii Kapustian as a new Director, Production Assets Man- agement (as a member of the Executive Management Team) with effect as of 19 Au- gust 2025; • resolved to appoint Mr. Aibiek Toktomushev as the new Director, Security (as a member of the Executive Management Team) with effect as of 26 August 2025. The full list of the members of the Executive Management Team, including short biog- raphies for each member is available on the Company’s website. Responsibilities of the Executive Management Team are described in more detail in the Com- pany’s Corporate Governance Charter, avail- able on the Company’s website. Various committees are operating on the Ex- ecutive Management Team level, including the Strategy Committee, the Investment Com- mittee, the Trade Committee, and the Risk Committee. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 95 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Corporate Governance continued Remuneration report This remuneration report is published in ac- cordance with article 7ter of the Luxembourg law of 24 May 2011 on the exercise of certain rights of shareholders at general meetings, as amended. The compensation principles for the Board and the Executive Management Team are specified in the Remuneration Policy of the Company. The Group pays remuneration to the Board and the Executive Management Team only in accordance with the Remunera- tion Policy. The Remuneration Policy must be submitted to a vote by the general meeting at every material change and, in any case, at least every four years. The most recent approval of the Remunera- tion Policy took place at the annual general meeting held on 11 December 2023, where shareholders: • approved an amendment to the long-term management incentive plan in the form of share put option agreements; and • approved the Remuneration Policy, follow- ing the requirements of Article 7bis of the Luxembourg law of 24 May 2011 on the ex- ercise of certain rights of shareholders at general meetings, as amended. Remuneration of the Board The compensation of the Company’s Directors solely consists of the fixed fees paid for the services rendered in their capacity as mem- bers of the Board of Directors. No perfor- mance-based variable component, pension, retirement, or similar benefits are provided by the Company. This ensures a certain degree of independence when it comes to fulfilling the Board’s duties towards the Executive Man- agement Team. On top of that, Directors are reimbursed for certain travel, hotel, and other expenses related to the exercise of their du- ties. The fees paid to the independent directors and the fees paid to executive directors are ap- proved at the annual general shareholders’ meeting. Further details on the remuneration of the Board are available in the Company’s Remuneration Policy. Non-executive Direc- tors are reimbursed for educational expenses related to enhancing the competencies neces- sary for their duties. Three executive Directors in their capacity as members of the Executive Management Team also receive compensation for their services provided to subsidiaries of the Company, with such compensation being paid by the subsidi- aries of the Company. One other executive Di- rector, not being a member of the Executive Management Team, also receives compensation as an employee of the Com- pany. Remuneration of the Executive Man- agement Team Compensation of the members of the Execu- tive Management Team (15 people in total) is based on a pay-for-performance principle, re- warding sustainable growth and long-term value creation for shareholders of the Com- pany. A significant portion of the remuneration comes from a variable part depending on the Group’s consolidated financial performance. For details, please see the figure above. The principles of the remuneration of the Ex- ecutive Management Team are specified in the Remuneration Policy. Members of the Executive Management Team are not granted any pension, retirement, or similar benefits provided by the Company, apart from those required by law. The Company believes that the Remuneration Policy strongly contributes to the long-term shareholder value creation and the Com- pany’s stability. Nomination and Remuneration Com- mittee The Nomination and Remuneration Commit- tee (the “N&R Committee”) is a continuously operating collective body of the Board. It is es- tablished from among the members of the Board and consists of three members, includ- ing a chairman elected by the members of the N&R Committee amongst themselves. The majority of the members of the N&R Commit- tee (including the chairman) are non-executive independent Directors. The role of the N&R Committee is to assist the Board in fulfilling its responsibilities by review- ing, advising, and making recommendations to the Board, the Chairman, and the CEO on the nomination to the Board and Executive Management Team and their remuneration. The N&R Committee assists the Board in nominating and assessing candidates for both directorship and managerial positions, estab- lishing and reviewing the compensation princi- ples specified in the Remuneration Policy. The N&R Committee ensures that only persons with adequate competencies, experience, and skills are appointed to the Board. The N&R Committee also supports the Board in prepar- ing the Board’s remuneration proposals for the shareholders’ general meeting. A detailed list of N&R Committee responsibilities is available in the Corporate Governance Charter, pub- lished on the Company’s website. Nomination and Remuneration Com- mittee’s activity report The N&R Committee held two meetings during the reporting period, discussing the perfor- mance of the CEO and the Executive Manage- ment Team, the remuneration of the executive management team, and amendments to the option period under the management incen- tive plans. The attendance rate of the Commit- tee members was 100%. Additionally, the N&R Committee held two ad- hoc meetings after the reporting date, in Au- gust 2025, to discuss the nomination of new directors to the Executive Management Team. At the additional meeting held in October 2025, the N&R Committee settled on the Ex- ecutive Management Team compensation for FY2025 standing at USD 23,812 thousand (in- cluding a bonus of USD 21,192 thousand) for 15 key executives, as compared to the total compensation of USD 27,074 thousand (in- cluding a bonus of USD 24,000 thousand) for 15 key executives a year ago. ………………………………………………………………………………………………………………………………………................. Remuneration of the Board of Directors USD thousands FY2021 FY2022 FY2023 FY2024 FY2025 Chairman of the Board 200 200 200 200 200 Other executive Directors 40 40 40 40 40 Non-executive Directors 260 275 240 240 232 Total Board of Directors 500 515 480 480 472 Excluding reimbursement of travelling expenses incurred by Directors in performing their duties. ……………………………………………………………………………………………………………………………………….............. Remuneration of the Executive Management Team USD thousands FY2021 FY2022 FY2023 FY2024 FY2025 Total remuneration 29,334 8,492 20,585 27,074 23,812 Base salary 2,834 2,949 2,683 3,074 2,620 Short-term variable bonus 26,500 5,543 17,902 24,000 21,192 Number of executive managers 15 15 15 15 15 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 96 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Corporate Governance continued ………………………………………………………………………………………………………………………………………........................................................................................................................... Compensation structure of the Executive Management Team Fixed remuneration Members of the Executive Management Team receive a base salary determined at the discretion of the Board, commen- surate with the respective position and the individual profile of the relevant members in terms of qualifications, skill set, and experience. Al l amounts are fixed and shall be paid monthly. In FY2025, the aggregated base salary for 15 members of the Executive Management Team amounted to USD 2,620 thousand paid by the subsidiaries of the Company. Variable remuneration An annual variable monetary bonus (if applicable) is paid as well. Such bonus is determined by the formula approved by the Board of Directors upon the recommendation of the N&R Committee. The bonus shall reward the members of the Executive Management team for the financial performance of the Group, which derives from the financial performance of each of its subsidiaries where each respective member of the Executive Management Team is employed or has contractual obligations. The structure of the variable remuneration is as follows: • The bonus pool for 13 members of the Executive Management Team (the “Bonus Pool” ) is expressed as a percentage of the consolidated EBITDA of the Group less the consolidated financial costs of the Group normalized for the effect of certain one-off and nonrecurring transactions (“EBITDA Less Finance Costs” ), with a minimum threshold level of USD 123 million required to activate the pay- out. The Bonus Pool as a percentage of EBITDA Less Finance Costs is gradually increasing starting from 0.46% of EBITDA Less F inance Costs in case EBITDA Less Finance Costs exceeds USD 123 million and reaching 3.66% of EBITDA Less Finance Costs in case EBITDA Less Finance Costs exceeds USD 443 million. The exact allocation of the Bonus Pool between the relevant members of the Exe cutive Management Team is determined by the N&R Committee. • Two members of the Executive Management Team have different metrics determining their variable remuneration, in- cluding the financial results of the business divisions they lead, the Group EBITDA and personal key performance indi- cators. The variable remuneration is paid by the subsidiaries of the Company for duties and services provided by members of the Executive Management Team to subsidiaries of the Company. In FY2025, the aggregated variable remuneration for 15 members of the Executive Management Team amounted to USD 21,192 tho usand to be paid by the subsidiaries of the Company. Long-term manage- ment incentive plan Seven beneficiaries are subject to the long-term management incentive plan, of whom four currently hold positions within the Executive Management Team and the remaining three occupy other roles within the Company, having been members of the Executive Management Team when the plan was introduced. The plan was designed to reward such members of the Executive Management Team for accomplishing individual performance goals related to the duties and services pro- vided by such individuals to subsidiaries of the Company, altogether contributing to the better financial and non- financial results of the group of companies to which the Company belongs over the long- term period and aligning the interests of the Executive Management Team with those of the shareholders of the Company. The long-term management incentive plan was duly reviewed by the N&R Committee and approved by the Board of Direc- tors after the generic terms thereof having been approved by the general meeting of shareholders. Seven beneficiaries were granted put options providing the right but not the obligation to sell a fixed number of Company’s shares owned by management at the moment at Put Price during the exercise period: • The exercise period shall commence on 1 November 2025 and end on 31 December 2026 (or, in certain cases, 31 December 2027). The option period was postponed by 12 months (originally scheduled to begin on 1 November 2024) as the beneficiaries agreed to suppo rt the Company’s liquidity position in light of its debt burden and related future outflows, the uncertainty of financial performance due to the ongoing war in Ukraine, and the currency and capital flow restrictions imposed by the Ukrainian authorities. If no put options are exercised during the exercise period, they shall lapse. Put option also provides for acceleration events which dictate that the put options may be exercised before the commencement of the exercise period if the following events occur: 1) the cessation of trading of Company's shares at the Warsaw Stock Exchange or any other recognized stock exchange; or 2) a change of control event where the share- holding of Namsen Limited or its ultimate beneficial owner in Kernel's total votes falls belo w twenty five percent (25%). In such cases, put options may be exercised only after 12 months following the occurrence of the relevant events. • The Put Price is determined as lower of (1) USD 23.80; or (2) operating profit before working capital changes minus interest paid plus interest received minus interest tax paid, minus maintenance capital expenditures in the fixed amount of USD 155,000,000, where all amounts, except for the maintenance capital expenditures, are specified in USD in the relevant paragraph of the consolidated statement of cash flows of the audited annual consolidated accounts of the Com- pany and its subsidiaries for the Financial Years 2022-2024, divided by 3, divided by 12%, and divided by 84,031,230. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 97 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Corporate Governance continued Accountability and audit Going concern The Group’s business activities, together with the factors affecting its performance, position, and future development are set out in the man- agement report on pages 1-38. The financials of the Group, its liquidity position, borrowing facilities, and applicable terms are described in the financial statement’s accounts. Current economic conditions have fostered the development of several risks and uncer- tainties for the Company, in particular, related to the war in Ukraine (see details in the Risks and Uncertainties section of this report). The Directors have reviewed the current and projected financial position of the Company, making reasonable assumptions about the fu- ture trading and production performance, as well as the debt requirements. The results show that the Company should be able to operate within the levels of its available capital. Therefore, the Board has a reasona- ble expectation that the Company has ade- quate resources to continue in operational ex- istence for the foreseeable future. Accord- ingly, the Board continues to adopt the going concern basis in preparing the annual report and accounts. Takeover disclosure The Company’s shares are in electronic form (77,429,230 shares) and registered form (216,000,000 shares) and are freely transfer- able, subject only to the provisions of law and the Company’s Articles of Association. There are no agreements between the Company and its employees or directors providing compen- sation for the loss of office or employment (whether through resignation, purported re- dundancy, or otherwise) that would occur be- cause of a takeover bid. Put options granted under management incentive plans incorpo- rate accelerated vesting in the event of a take- over. The Group, in the ordinary course of business, has entered into various agreements with cus- tomers and suppliers around the world. Some of the Company’s borrowing agreements, which either by their nature or value may rep- resent significant agreements, do provide for the right of termination upon a change of con- trol of the Company. The commercial sensitiv- ity of these agreements prevents their details from being disclosed. Except for the preceding disclosure, there are no other significant agreements to which the Company is a party that take effect, alter, or terminate upon a change of control following a takeover of the Company. Audit Committee The Audit Committee is a continuously operat- ing collective body of the Board. It consists of three members including a chairman, all of whom are non-executive directors and two of whom meet the independence criteria. The members have competence in accounting and audit, and competence relevant to the sector in which the company is operating. The Audit Committee is fully capable of overseeing the affairs of the Company in the areas of ade- quacy and effectiveness of the Kernel’s sys- tem of financial reporting, corporate govern- ance, internal controls, and risk management. The functioning and key responsibilities of the Audit Committee are described in the Articles of Association and further specified in the Cor- porate Governance Charter. Audit Committee activity report The Audit Committee had eight meetings in FY2025, including two in-person meetings in Luxembourg and the rest via teleconference. The average attendance rate of Committee members was 100% for the reporting period. The Chief Financial Officer was invited and at- tended all the meetings of the Audit Commit- tee. Additionally, the Audit Committee invited the CEO, head of internal audit, compliance officer, sustainability manager, head of report- ing and controls, head of IT, and head of busi- ness continuity to its meetings. The represent- atives of the external auditor (PwC) were in- vited and attended four meetings of the Audit Committee. During its meetings, the Audit Committee had one closed session with the external auditor and one session with the head of internal audit to communicate without the presence of exec- utives. Additionally, the decisions of the Audit Com- mittee were taken via two circular resolutions signed throughout FY2025. To execute its key functions and discharge its responsibilities as outlined in the Corporate Governance Charter, the Audit Committee, during FY2025: • assisted the Board in monitoring the relia- bility and integrity of the financial infor- mation provided. The committee reviewed the consolidated quarterly, semi-annual, and annual financial reports of the Group, standalone annual accounts of the Com- pany, Avere financial statements, reviewed critical accounting policies and manage- ment estimates, among other things; • conducted oversight over the perfor- mance of the internal audit function, in- cluding the review of the internal audit activ- ities and action plans and reports. The Audit Committee had one face-to-face discussion with the head of the internal audit in the ab- sence of executives; • conducted oversight over the perfor- mance of the external audit function in- cluding review of the annual audit plan and scope of semiannual accounts review and areas of focus, review of auditor reports, presentations and additional auditors’ re- port, and management letter review. The Audit Committee had one face-to-face dis- cussion with the external auditors in the ab- sence of executives. The Audit Committee monitored the fee cap of non-audit services, and reviewed the contract with auditors (in- cluding a review of expected fees for the au- dit and consulting services) and the inde- pendence of the external auditor; • conducted oversight over the risk man- agement function. The Audit Committee assisted the Board in the discharge of its risk management responsibilities, monitor- ing and examining the effectiveness of the Company’s internal control and risk moni- toring system; reviewing top risks, risk miti- gation plans, and results of risk mitigation activities, overseeing group risk manage- ment procedures; reviewing trade manage- ment position risk mitigation activities; re- view of climate, physical, and transitional risks relevant to Kernel’s operations; • conducted oversight over the compliance function, including implementation of the Corporate Governance Charter provisions, compliance with good corporate govern- ance practices concerning the functioning of the Audit Committee, and reviewing reports from the Kernel Compliance Officer on the progress achieved in the enhancement of the Company’s compliance function; • discussed various ad-hoc items. During FY2025, the Audit Committee also re- ceived several updates on specific matters, in- cluding the Group’s cyber security and related mitigation measures, preparation to the report- ing under EU Corporate Sustainability Report- ing Directive (CSRD), as well as development of the group-wide business continuity strategy. After each meeting, the chairman of the Audit Committee reports to the Board on the key matters discussed, along with the Commit- tee’s recommendations on items requiring Board approval. In line with the best corporate governance practices, the Audit Committee conducted an annual self-evaluation assessment in FY2025, assessing its effectiveness, composition, and working practices. The review indicated poten- tial areas of Audit Committee performance and activities improvement and resulted in a clear action plan based on the results of the self-evaluation procedure. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 98 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Corporate Governance continued Additionally, in 2025, the Audit Committee as- sessed the efficiency of internal control, risk management and compliance systems, and internal audit function. The Audit Committee agreed that the overall assessment of the in- ternal control and risk management system is rather effective, the overall assessment of the compliance system is effective, and the overall assessment of the internal audit function is ef- fective. Internal audit As an integral part of the system of internal control, the Company has an internal audit de- partment headed by an experienced profes- sional reporting directly to the Board of Direc- tors via the Audit Committee and to the CEO of the Company as a chairman of the Risk Committee within the Executive Management Team and working closely with the Board. In- ternal audit is a separate independent unit in the Group’s organizational structure. Internal auditing strengthens the Companys ability to create, protect, and sustain value by providing the Board and Management Team with independent, risk-based, and objective assurance, advice, insight, and foresight. In- ternal auditing enhances the Companys: • Successful achievement of its objectives; • Governance, risk management, and control processes; • Decision-making and oversight; • Reputation and credibility with its stakehold- ers; • Ability to serve the public interest. The independence rules defined in accepted Global Internal Audit Standards apply to mem- bers of the internal audit department. The main responsibilities of the internal audit are: • to maintain continuous support for the Di- rectors on risk management, internal con- trols, and mitigation activities by undertak- ing regular or ad hoc reviews; • to provide an independent and objective evaluation of the effectiveness and effi- ciency of corporate governance, internal control, and risk-management systems within the operational framework of the Company; • to assist personnel and management of the Company in improving the effectiveness of risk identification and internal control sys- tems in operations; advise and consult them regarding how to effectively execute their responsibilities, including recommendations on specific improvements in policies and procedures; and • to assist in open and two-way communica- tion among internal and external auditors, management and personnel, the Audit Committee, and the Board. The Head of internal audit regularly presents the results of its work to the Audit Committee, including communication with the committee members in the absence of executives. External audit PwC Société cooperative (“PwC”), with its reg- istered office at 2, rue Gerhard Mercator B.P. 1443 L-1014 Luxembourg and register num- ber B 65 477 with the Luxembourg Trade and Companies Register, acts as an external au- ditor of Kernel’s consolidated and standalone accounts since FY2022. PwC attended four meetings of the Audit Com- mittee in FY2025, presenting the review of the semi-annual accounts, and audit plan for FY2025, and presenting to the Audit Commit- tee the approach to accounting and audit of various business operations, among other things. The Audit Committee reviews and monitors the level of fees paid by the Com- pany to the external auditor, preapproves per- missible non-audit services, and monitors the cap on non-audit fees. Remuneration to auditors in FY2025 amounted to USD 818 thousand (including USD 55 thousand non-audit services), as compared to USD 804 thousand (including USD 26 thousand non-audit services) in FY2024. GOV-2 Sustainable development The sustainability function at Kernel is gov- erned by the Board via a Sustainability Com- mittee, which has the purpose of: • overseeing the overall performance of the sustainability corporate function of the Com- pany and the Group; • ensuring the implementation of the environ- mental, social, and sustainability govern- ance agendas across all business opera- tions; and • connecting these agendas with the Group’s strategy, business objectives, and capital allocation decisions. The Sustainability Committee had one meet- ing during the reporting period, discussing the following: • update on the business opportunities re- lated to sustainability function and climate change; • progress on non-financial data accounting and audit, including integration of the EU standard on non-financial corporate report- ing, development of internal procedures and policies; • Kernel's participation at 29th Conference of Parties. At the meeting held in July 2025, the Sustain- ability Committee discussed: • results and procedures of Kernel’s double- materiality assessment; • final structure of the Sustainability section of the Annual Report. Business ethics and compli- ance Kernel has embedded strong ethical stand- ards in the Company’s everyday operations, as outlined in the Code of Conduct. Addition- ally, the AGM held on 10 December 2021 ap- proved the Diversity, Equality, and Inclusion Policy of the Company and its subsidiaries. Kernel implemented a Corporate Compli- ance Program (“CCP”) designed to align the Company’s practices with international best standards. The program combines internal and external control mechanisms, ensuring consistent monitoring, evaluation, and im- provement of compliance processes. Inde- pendent reviews have recognized the signifi- cant progress achieved in strengthening the system while also outlining areas for continu- ous enhancement, which remain a focus of management. The compliance function within Kernel is led by a dedicated compliance officer, who reports directly to the CEO and Board of Directors via the Audit Committee of the Board. The compli- ance officer attends all Audit Committee meet- ings and provides compliance system and control updates at least twice a year. We prioritize strong relationships with counter- parties, assessing their risks based on trust- worthiness, corruption, and sanctions in line with our risk appetite. Anti-corruption and anti- sanctions clauses are included in all contracts with counterparties. These clauses consider both national and foreign legislation require- ments in connection with the Russian war in- vasion of Ukraine. We’ve updated our anti-cor- ruption provisions to align with legislative changes, strengthened controls, enhanced due diligence processes, and revised contract …………………………………………………………………….. External auditor’s fees USD thousand 717 526 781 778 763 294 257 1,011 783 781 804 818 FY2021 FY2022 FY2023 FY2024 FY2025 Audit fees Non-audit services Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 99 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Corporate Governance continued templates and clauses accordingly. Kernel is a member of the Ukrainian Network of Integrity and Compliance (UNIC) and a sig- natory of the UN Global Compact and the Memorandum of UN Collective Action to Com- bat Corruption. These platforms are effective for sharing best practices in preventing corrup- tion between companies and promoting a cor- porate culture of integrity in the agricultural sector. In recent years, Kernel has made continuous efforts to promote gender equality and inclu- sion, actively creating and supporting favora- ble workplaces. Gender diversity and equality are core values, with dignity and honesty at the foundation. Kernel remains committed to addressing gender asymmetry across all ar- eas of the company. In FY2025, the Group continued to implement its Equal Opportunities and Cultural Diversity Policy, reinforcing its long-standing commit- ment to gender equality, inclusion, and the promotion of respectful and safe workplaces. Diversity and equal treatment are deeply em- bedded in the Group’s values, grounded in the principles of dignity and integrity. Kernel re- mains focused on addressing gender asym- metry across all areas of its operations. A sur- vey conducted in June 2025 among employ- ees indicated that 100% of respondents re- ported no experience of gender-based ine- quality in the workplace. Key actions taken in 2024-2025 to further strengthen the Group’s compliance and ethi- cal culture included: • Adoption of a Human Rights Compliance Policy, formalizing the Group’s approach to respecting and protecting fundamental hu- man rights across its operations; • Implementation of an Anti-Money Launder- ing Policy, aimed at enhancing internal safeguards and risk management proce- dures in line with applicable regulations; • Launch of an e-learning course titled “Pre- venting Sexual Violence in the Workplace”, completed by more than 4 thousand em- ployees. Additionally, a dedicated anti-vio- lence webinar featuring a professional psy- chologist was held to address practical pre- vention tools and reinforce a zero-tolerance approach to misconduct; • Revision and enhancement of the Conflict of Interest Management and Anti-Fraud and Corruption Policy, including updated train- ing materials and employee briefings. A new brochure, Illegal and Inadmissible Ac- tions, was distributed across the organiza- tion to illustrate the key policy changes and reinforce ethical standards; • Continued application of the Anti-Corruption Clause in all contracts with counterparties, ensuring alignment with the Group’s compli- ance requirements throughout the supply chain; • Development and deployment of a video- based compliance training course, “Compli- ance on the Guard of Business”, focused on anti-corruption and equality. Nearly 5 thou- sand employees completed the course, sig- nificantly expanding coverage beyond what traditional face-to-face training could achieve. The video is now part of the onboarding process for all new hires and will be redistributed annually to all existing employees. Kernel’s compliance efforts focus on: • preventing fraud, corruption, and other misconduct (see details in section Anti-cor- ruption); • managing risks related to unreliable counterparties and international sanc- tions. Compliance officer and security de- partment check business partners for com- pliance risks: sanctions, corruption, money laundering, terrorism financing; • ensuring the Company’s activities comply with various external initiatives (GDPR; United Nations Global Compact; equality, diversity, and inclusion initiatives, etc.); • ensuring employee adherence to internal policies, including the Code of Conduct, Policy for managing conflicts of interest, combating fraud and corruption, and other internal documents on compliance. The compliance officer oversees incident man- agement for all stakeholders. To enhance employee awareness of business ethics, we offer an e-learning course on the Code of Conduct. All new employees must achieve a minimum 80% pass rate during onboarding. PricewaterhouseCoopers Assurance, Société coopérative, 2 rue Gerhard Mercator, L-2182 Luxembourg T : +352 494848 1, F : +352 494848 2900, www.pwc.lu Cabinet de révision agréé. Expert-comptable (autorisation ministérielle n°10181659) R.C.S. Luxembourg B294273 - TVA LU36559370 www.pwc.lu Audit report To the Shareholders of Kernel Holding S.A. Report on the audit of the consolidated financial statements Our opinion In our opinion, the accompanying consolidated financial statements give a true and fair view of the consolidated financial position of Kernel Holding S.A. (the “Company”) and its subsidiaries (the “Group”) as at 30 June 2025, and of its consolidated financial performance and its consolidated cash flows for the year then ended in accordance with IFRS Accounting Standards as adopted by the European Union. Our opinion is consistent with our additional report to the Audit Committee or equivalent. What we have audited The Group’s consolidated financial statements comprise: • the consolidated statement of financial position as at 30 June 2025; • the consolidated statement of profit or loss for the year then ended; • the consolidated statement of profit or loss and other comprehensive income for the year then ended; • the consolidated statement of changes in equity for the year then ended; • the consolidated statement of cash flows for the year then ended; and • the notes to the consolidated financial statements, including material accounting policy information and other explanatory information. 101 Basis for opinion We conducted our audit in accordance with the EU Regulation No 537/2014, the Law of 23 July 2016 on the audit profession (Law of 23 July 2016) and with International Standards on Auditing (ISAs) as adopted for Luxembourg by the “Commission de Surveillance du Secteur Financier” (CSSF). Our responsibilities under the EU Regulation No 537/2014, the Law of 23 July 2016 and ISAs as adopted for Luxembourg by the CSSF are further described in the “Responsibilities of the “Réviseur d’entreprises agréé” for the audit of the consolidated financial statements” section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. We are independent of the Group in accordance with the International Code of Ethics for Professional Accountants, including International Independence Standards, issued by the International Ethics Standards Board for Accountants (IESBA Code) as adopted for Luxembourg by the CSSF together with the ethical requirements that are relevant to our audit of the consolidated financial statements. We have fulfilled our other ethical responsibilities under those ethical requirements. To the best of our knowledge and belief, we declare that we have not provided non-audit services that are prohibited under Article 5(1) of the EU Regulation No 537/2014. The non-audit services that we have provided to the Company and its controlled undertakings, if applicable, for the year then ended, are disclosed in Note 25 to the consolidated financial statements. Material uncertainty related to going concern We draw attention to Note 4 to the consolidated financial statements, which indicates that since 24 February 2022 the Group's operations are significantly affected by the ongoing military invasion of Ukraine and the magnitude of further developments or the timing of the cessation of these circumstances, are uncertain. These events or conditions, along with other matters as set forth in Note 3, indicate that a material uncertainty exists that may cast significant doubt on the Group’s ability to continue as a going concern. Our opinion is not modified in respect of this matter. Key audit matters Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. In addition to the matter described in the “Material Uncertainty Related to Going Concern” section above, we have determined the matters described below to be the key audit matters to be communicated in our report. 102 Key audit matter How our audit addressed the key audit matter Revaluation of classes of property, plant and equipment in the oilseed processing segment As disclosed in Note 5 to the consolidated financial statements, management performed a revaluation of specific classes of property, plant and equipment within the oilseed processing segment carried under the revaluation model of USD 481 million. The fair value was determined in accordance with IFRS 13 Fair Value Measurement, using depreciated replacement cost (DRC) method, adjusted for the economic obsolescence determined based on discounted cash flow (DCF) model, if the expected cash flows are lower than those obtained using depreciated replacement cost. The valuation is highly judgemental and requires the use of unobservable inputs. The assumptions with the most significant impact on the discounted cash flows results were sales prices of sunflower oil, the purchase price of sunflower seeds, processing volume and discount rate for the oilseed processing segment. Taking into account the significant management judgements and the magnitude of the amounts involved, we considered this to be a key audit matter. Refer to Notes 5 and 14 to the consolidated financial statements for the related disclosures. Our audit procedures included the following: • Engaging our internal valuation experts to assess the appropriateness of the methodology applied by the external independent valuer in determining DRC amounts and the appropriateness of the methodology applied by the Group in calculating the discounted cash flow results; • Verifying input data used by the external independent valuer in determination of the depreciated replacement cost of assets; • Engaging our internal valuation experts to assess the reasonableness of the discount rate used; • Evaluating management's ability to reasonably estimate cash flow forecasts by comparing actual results to management's historical forecasts; • Evaluating and challenging significant assumptions used by management in the calculations of economic obsolescence, such as sales prices of sunflower oil, the purchase price of sunflower seeds, and processing volume; • Checking the sensitivity analysis over significant assumptions used; • Verifying the mathematical accuracy and integrity of calculations and the adequacy of the Group’s disclosures in Notes 5 and 14 to the consolidated financial statements. Valuation of current biological assets The Group measures biological assets at fair value less costs to sell in accordance with IAS 41 Agriculture and IFRS 13 Fair Value Measurement. As of 30 June 2025, the Group had current biological assets comprising mainly winter and spring crops of the 2024/25 season, which were not yet harvested in the amount of USD 229 million. The Group calculates the fair value less costs to sell on the basis of the discounted cash flow forecasts, applying the following significant assumptions: • crop yields; • grain sales prices net of transportation costs. Our audit procedures included the following: • Gaining an understanding of management’s process for the development of significant assumptions used in the valuation and assessing the appropriateness of the valuation methodology applied; • Evaluating and challenging significant assumptions used in the valuation, such as crop yields and grain sales prices net of transportation costs, based on the internal and external data which supports these assumptions; • Checking the sensitivity analysis over significant assumptions used; • Verifying the mathematical accuracy and integrity of calculations and the adequacy of the Group’s disclosures in Note 5 and 12 to the consolidated financial statements. 103 Key audit matter How our audit addressed the key audit matter Taking into account the significant management judgements and the magnitude of the amounts involved, we considered this to be a key audit matter. Refer to Note 5 and 12 to the consolidated financial statements for the related disclosure. Other information The Board of Directors is responsible for the other information. The other information comprises the information stated in the annual report including the Management Report and the Corporate Governance Statement but does not include the consolidated financial statements and our audit report thereon. Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance conclusion thereon. In connection with our audit of the consolidated financial statements, our responsibility is to read the other information identified above and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. Responsibilities of the Board of Directors for the consolidated financial statements The Board of Directors is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with IFRS Accounting Standards as adopted by the European Union, and for such internal control as the Board of Directors determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. In preparing the consolidated financial statements, the Board of Directors is responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so. The Board of Directors is responsible for presenting and marking up the consolidated financial statements in compliance with the requirements set out in the Delegated Regulation 2019/815 on European Single Electronic Format (“ESEF Regulation”). 104 Responsibilities of the “Réviseur d’entreprises agréé” for the audit of the consolidated financial statements The objectives of our audit are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an audit report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the EU Regulation No 537/2014, the Law of 23 July 2016 and with ISAs as adopted for Luxembourg by the CSSF will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements. As part of an audit in accordance with the EU Regulation No 537/2014, the Law of 23 July 2016 and with ISAs as adopted for Luxembourg by the CSSF, we exercise professional judgment and maintain professional scepticism throughout the audit. We also: • identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control; • obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control; • evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Board of Directors; • conclude on the appropriateness of the Board of Directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our audit report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our audit report. However, future events or conditions may cause the Group to cease to continue as a going concern; • evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation; 105 • plan and perform the group audit to obtain sufficient appropriate audit evidence regarding the financial information of the entities and business units within the Group as a basis for forming an opinion on the consolidated financial statements. We are responsible for the direction, supervision and review of the audit work performed for purposes of the group audit. We remain solely responsible for our audit opinion. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and communicate to them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards applied. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our audit report unless law or regulation precludes public disclosure about the matter. We assess whether the consolidated financial statements have been prepared, in all material respects, in compliance with the requirements laid down in the ESEF Regulation. Report on other legal and regulatory requirements The Management Report is consistent with the consolidated financial statements and has been prepared in accordance with applicable legal requirements. The Corporate Governance Statement is included in the Management Report. The information required by Article 68ter Paragraph (1) Letters c) and d) of the Law of 19 December 2002 on the commercial and companies register and on the accounting records and annual accounts of undertakings, as amended, is consistent with the consolidated financial statements and has been prepared in accordance with applicable legal requirements. We have been appointed as “Réviseur d’Entreprises Agréé” by the General Meeting of the Shareholders on 11 December 2023 and the duration of our uninterrupted engagement, including previous renewals and reappointments, is 3 years. We have checked the compliance of the consolidated financial statements of the Group as at 30 June 2025 with relevant statutory requirements set out in the ESEF Regulation that are applicable to consolidated financial statements. 106 For the Group it relates to the requirement that: • the consolidated financial statements are prepared in a valid XHTML format; • the XBRL markup of the consolidated financial statements uses the core taxonomy and the common rules on markups specified in the ESEF Regulation. In our opinion, the consolidated financial statements of the Group as at 30 June 2025 have been prepared, in all material respects, in compliance with the requirements laid down in the ESEF Regulation. Luxembourg, 3 October 2025 PricewaterhouseCoopers Assurance, Société coopérative Represented by Andrei Chizhov Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 107 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Statement of the Board of Directors’ Responsibilities for the Preparation and Approval of the Consolidated Financial Statements for the year ended 30 June 2025 The Board of Directors is responsible for the preparation, publishing and fair presentation of the consolidated financial statements in accordance with Luxembourg legal and regulatory requirements relating to the preparation and presentation of the consolidated financial statements, and for such internal control as the Board of Directors determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. In preparing the consolidated financial statements, the Board of Directors is responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so. We confirm that to the best of our knowledge and belief: • The consolidated financial statements of Kernel Holding S.A. (the “Company”) presented in this Annual Report and established in conformity with International Financial Reporting Standards as adopted by the European Union give a true and fair view of the consolidated statements of comprehensive income, changes in equity and cash flows for the year that ended, and notes to the consolidated financial statements, including a summary of significant accounting policies; and • The Management Report includes a fair review of the development and performance of the business and position of the Company and the undertakings included within the consolidation taken as a whole, together with a description of the principal risks and uncertainties it faces. 03 October 2025 On behalf of the Board of Directors Andrii Verevskyi Sergiy Volkov Chairman of the Board of Directors Director, Chief Financial Officer Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 108 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Selected Financial Data for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) USD 1 PLN EUR 30 June 2025 30 June 2024 30 June 2025 30 June 2024 30 June 2025 30 June 2024 I. Revenue 4,115,042 3,581,462 16,142,075 14,534,289 3,785,016 3,312,136 II. Profit from operating activities 361,046 276,428 1,416,275 1,121,800 332,090 255,641 III. Profit before income tax 287,243 211,052 1,126,768 856,491 264,206 195,181 IV. Profit for the period 237,596 167,628 932,018 680,268 218,541 155,022 V. Net cash generated by operating activities 241,664 472,136 947,975 1,916,022 222,283 436,631 VI. Net cash used in investing activities (40,343) (112,548) (158,253) (456,742) (37,107) (104,084) VII. Net cash used in financing activities (393,392) (504,102) (1,543,159) (2,045,747) (361,843) (466,194) VIII. Total net cash flow (192,071) (144,514) (753,437) (586,467) (176,667) (133,647) IX. Total assets 3,320,426 3,396,911 12,007,989 13,696,345 2,830,663 3,175,432 X. Current liabilities 666,854 1,367,062 2,411,611 5,511,994 568,492 1,277,929 XI. Non-current liabilities 574,586 163,555 2,077,933 659,454 489,835 152,891 XII. Issued capital 7,749 7,749 28,023 31,244 6,606 7,244 XIII. Total equity 2,078,986 1,866,294 7,518,445 7,524,897 1,772,336 1,744,612 XIV. Weighted average number of shares 293,276,353 256,839,066 293,276,353 256,839,066 293,276,353 256,839,066 XV. Profit per ordinary share (in USD/PLN/EUR) 0.81 0.65 3.19 2.65 0.75 0.60 XVI. Diluted number of shares 293,276,353 256,839,066 293,276,353 256,839,066 293,276,353 256,839,066 XVII. Diluted profit per ordinary share (in USD/PLN/EUR) 0.81 0.65 3.19 2.65 0.75 0.60 XVIII. Book value per share (in USD/PLN/EUR) 7.09 6.35 25.64 25.60 6.04 5.94 XIX. Diluted book value per share (in USD/PLN/EUR) 7.09 6.35 25.64 25.60 6.04 5.94 1 Please see Note 4 for the exchange rates used for conversion. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 109 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Consolidated Statement of Financial Position for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) Notes As of 30 June 2025 As of 30 June 2024 Assets Current assets Cash and cash equivalents 8, 32 617,511 809,584 Trade accounts receivable 9, 32 252,660 305,246 Prepayments to suppliers 91,804 120,870 Corporate income tax prepaid 6,434 227 Taxes recoverable and prepaid 10 125,837 114,127 Inventory 11 363,467 277,660 Biological assets 12 230,669 187,712 Other financial assets 13, 32 315,913 339,929 Total current assets 2,004,295 2,155,355 Non-current assets Property, plant and equipment 14 946,342 944,104 Right-of-use assets 15 245,611 172,931 Intangible assets 16 34,788 36,394 Goodwill 13,196 13,196 Deferred tax assets 22 51,698 35,626 Non-current financial assets 6,025 23,307 Other non-current assets 18,471 15,998 Total non-current assets 1,316,131 1,241,556 Total assets 3,320,426 3,396,911 Liabilities and equity Current liabilities Trade accounts payable 32 108,348 109,672 Advances from customers and other current liabilities 17 257,285 192,397 Corporate income tax liabilities 39,664 31,433 Short-term borrowings 19 148,887 315,166 Current portion of long-term borrowings 19 22,239 — Current portion of lease liabilities 21 34,021 27,206 Current bonds issued 20, 32 — 597,580 Interest on bonds issued 20, 32 3,616 7,612 Other financial liabilities 18, 32 52,794 85,996 Total current liabilities 666,854 1,367,062 Non-current liabilities Long-term borrowings 19 82,307 — Bonds issued 20, 32 298,487 — Lease liabilities 21 171,234 142,534 Deferred tax liabilities 22 19,194 20,035 Other non-current liabilities 32 3,364 986 Total non-current liabilities 574,586 163,555 Equity attributable to Kernel Holding S.A. equity holders Issued capital 2 7,749 7,749 Share premium reserve 2 457,935 457,935 Additional paid-in capital 2 39,944 39,944 Revaluation reserve 103,766 96,178 Translation reserve (1,055,011) (1,029,114) Retained earnings 2,523,546 2,291,951 Total equity attributable to Kernel Holding S.A. equity holders 2,077,929 1,864,643 Non-controlling interests 1,057 1,651 Total equity 2,078,986 1,866,294 Total liabilities and equity 3,320,426 3,396,911 Book value 2,077,929 1,864,643 Number of shares 2, 33 293,129,230 293,429,230 Book value per share (in USD) 7.09 6.35 Diluted number of shares 33 293,129,230 293,429,230 Diluted book value per share (in USD) 7.09 6.35 On behalf of the Board of Directors Andrii Verevskyi Sergiy Volkov Chairman of the Board of Directors Director, Chief Financial Officer Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 110 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Consolidated Statement of Profit or Loss for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) On behalf of the Board of Directors Andrii Verevskyi Sergiy Volkov Chairman of the Board of Directors Director, Chief Financial Officer Notes For the year ended 30 June 2025 For the year ended 30 June 2024 Revenue 7 4,115,042 3,581,462 Net change in fair value of biological assets and agricultural produce 12 6,590 (10,447) Cost of sales 23 (3,553,173) (2,888,959) Gross profit 568,459 682,056 Other operating income 24 67,808 76,593 Other operating expenses 24 (46,414) (28,405) General and administrative expenses 25 (235,268) (213,373) Net impairment losses on financial assets (2,485) (11,217) Reversal of impairment losses/(impairment) of assets 26 8,946 (229,226) Profit from operating activities 361,046 276,428 Finance costs 27 (77,668) (119,079) Finance income 27 45,395 49,819 Foreign exchange (loss)/gain, net (5,249) 32,972 Other expenses, net 28 (36,281) (29,088) Profit before income tax 287,243 211,052 Income tax expenses 22 (49,647) (43,424) Profit for the period 237,596 167,628 Profit for the period attributable to: Equity holders of Kernel Holding S.A. 238,161 167,952 Non-controlling interests (565) (324) Earnings per share Weighted average number of shares 33 293,276,353 256,839,066 Profit per ordinary share (in USD) 0.81 0.65 Diluted number of shares 33 293,276,353 256,839,066 Diluted profit per ordinary share (in USD) 0.81 0.65 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 111 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Consolidated Statement of Profit or Loss and Other Comprehensive Income for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) Notes For the year ended 30 June 2025 For the year ended 30 June 2024 Profit for the period 237,596 167,628 Other comprehensive income/(loss) Items that will not be reclassified subsequently to profit or loss: Revaluation of property, plant and equipment 14 9,252 (9,909) Income tax related to components of other comprehensive income 22 (1,664) 1,784 Items that may be reclassified subsequently to profit or loss: Exchange differences on translating foreign operations 1 (25,926) (97,188) Other comprehensive loss (18,338) (105,313) Total comprehensive income for the period 219,258 62,315 Total comprehensive income attributable to: Equity holders of Kernel Holding S.A. 219,852 62,802 Non-controlling interests (594) (487) On behalf of the Board of Directors Andrii Verevskyi Sergiy Volkov Chairman of the Board of Directors Director, Chief Financial Officer 1 Exchange differences on translating foreign operations decreased mostly as a result of foreign exchange rate change. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 112 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Consolidated Statement of Changes in Equity for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) On behalf of the Board of Directors Andrii Verevskyi Sergiy Volkov Chairman of the Board of Directors Director, Chief Financial Officer Attributable to Kernel Holding S.A. shareholders Issued capital Share premium reserve Additional paid-in capital Treasury shares Revalua- tion reserve Translation reserve Retained Earnings Total Non- controlling interests Total equity Balance as of 30 June 2023 2,219 500,378 39,944 (96,897) 104,303 (932,089) 2,123,999 1,741,857 2,138 1,743,995 Profit for the period — — — — — — 167,952 167,952 (324) 167,628 Other comprehensive loss — — — — (8,125) (97,025) — (105,150) (163) (105,313) Total comprehensive income for the period — — — — (8,125) (97,025) 167,952 62,802 (487) 62,315 Increase of share capital 5,704 54,280 — — — — — 59,984 — 59,984 Cancellation of treasury shares (174) (96,723) — 96,897 — — — — — — Balance as of 30 June 2024 7,749 457,935 39,944 — 96,178 (1,029,114) 2,291,951 1,864,643 1,651 1,866,294 Profit for the period — — — — — — 238,161 238,161 (565) 237,596 Other comprehensive income/(loss) — — — — 7,588 (25,897) — (18,309) (29) (18,338) Total comprehensive income for the period — — — — 7,588 (25,897) 238,161 219,852 (594) 219,258 Other (Note 2) — — — — — — (6,566) (6,566) — (6,566) Balance as of 30 June 2025 7,749 457,935 39,944 — 103,766 (1,055,011) 2,523,546 2,077,929 1,057 2,078,986 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 113 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Consolidated Statement of Cash Flows for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) Notes As of 30 June 2025 As of 30 June 2024 1 Operating activities: Profit before income tax 287,243 211,052 Adjustments for: Amortization and depreciation 105,283 104,723 Finance costs 27 77,668 119,079 Finance income 27 (45,395) (49,819) Net impairment losses on financial assets 2,485 11,217 Loss on disposal of property, plant and equipment 394 530 Net foreign exchange loss/(gain) 6,169 (32,717) (Reversal) of impairment losses/impairment of assets 26 (8,946) 229,226 Write-downs of inventories to net realizable value 685 2,783 Net change in fair value of biological assets and agricultural produce 12 (6,590) 10,447 Loss/(gain) on sales of Subsidiaries 28 5,232 (2,448) Net loss/(gain) arising on financial instruments 4,680 (16,540) Other accruals 5,473 16,469 Operating profit before working capital changes 434,381 604,002 Changes in working capital: Change in trade receivable 53,001 10,425 Change in other financial assets (49,422) (19,228) Change in prepayments and other current assets 36,872 30,859 Change in taxes recoverable and prepaid (10,455) 36,391 Change in biological assets 17,010 (17,181) Change in inventories (143,493) (16,899) Change in trade accounts payable (7,203) (45,292) Change in advances from customers and other current liabilities 1,109 (397) Cash generated from operations 331,800 582,680 Interest paid (78,198) (110,878) Interest received 32,070 32,777 Income tax paid (44,008) (32,443) Net cash generated by operating activities 241,664 472,136 Investing activities: Purchase of property, plant and equipment (72,956) (142,578) Proceeds from disposal of property, plant and equipment 4,841 10,175 Payment for lease agreements (1,426) (1,426) Purchase of intangible and other non-current assets (11,902) (2,489) Proceeds from disposal of intangible and other non-current assets 947 — Acquisition of subsidiaries, net of cash acquired (4,029) (24,745) Disposal of subsidiaries 40 92,452 Pledge deposits withdrawal 13 1,303 121,400 Proceeds from disposal of/(Payment to acquire) financial assets 42,839 (165,337) Net cash used in investing activities (40,343) (112,548) Financing activities: Net proceeds from/(repayment of) credit lines 14,310 (35,319) Proceeds from short-term and long-term borrowings 149,607 109,463 Repayment of short-term and long-term borrowings (223,489) (619,580) Repayment of lease liabilities (34,171) (20,046) Proceeds from share premium reserve increase — 54,280 Issued capital — 5,704 Corporate bonds repaid (300,000) — Net cash used in financing activities (393,743) (505,498) Effects of exchange rate changes on the balance of cash held in foreign cur- rencies 351 1,396 Net decrease in cash and cash equivalents (192,071) (144,514) Cash and cash equivalents, at the beginning of the year 8 809,579 954,093 Cash and cash equivalents, at the end of the year 8 617,508 809,579 For non-cash financing activities please see Note 8. On behalf of the Board of Directors Andrii Verevskyi Sergiy Volkov Chairman of the Board of Directors Director, Chief Financial Officer 1 During the year ended 30 June 2025, the Group made certain corrections and reclassifications, please see Note 4 for more details. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 114 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) 1. Corporate Information Kernel Holding S.A. (hereinafter referred to as the “Holding” or the “Company”) incorporated under the legislation of Luxembourg on 15 June 2005 (number B 109,173 in the Luxembourg Register of Companies) is the holding company for a group of entities (hereinafter referred to as the “Subsidiaries”), which together form Kernel Group (hereinafter referred to as the “Group” or the “Kernel Group”). The principal place of production facilities of the Group is in Ukraine. Kernel Holding S.A. has been a publicly traded company since 2007. Kernel Holding S.A. made an announcement on 13 April 2023, indicating that their Board of Directors had decided to withdraw the company's shares from trading on the Warsaw Stock Exchange's regulated market. However, as of 30 June 2025, and as of the date of these consolidated financial statements issue the delisting process has not been completed and it is expected to be finalized upon resolution of legal proceedings disclosed in Note 30. The Group’s principal business activities comprise the production and export of sunflower oil and sunflower meal in bulk, the production and sale of bottled sunflower oil, the wholesale trade of grain, primarily corn, soybean, wheat, and barley, as well as farming operations, and the provision of logistics and transshipment services. As of 30 June 2025, the Group employed 10,760 people (30 June 2024: 10,904 people). The Group’s financial year runs from 1 July to 30 June. As of 30 June, the primary Subsidiaries of the Group and their principal activities were as follows: Group’s effective ownership interest and voting rights as of Subsidiary Principal activity Country of incorporation 30 June 2025 30 June 2024 Inerco Trade SA Trading in sunflower oil, meal and grain. Switzerland 100.0% 100.0% Kernel-Trade, LLC Ukraine 100.0% 100.0% Avere Commodities SA Switzerland 75.0% 1 100.0% Estron Corporation Ltd The holding ownership interests i n subsidiaries, their financing and strategic management. Cyprus 100.0% 100.0% Poltavsky VOEP, PJSC Oilseed crushing plants. Pro- duction of sunflower oil and meals. Ukraine 99.7% 99.7% Bandursky VOEP, LLC Ukraine 100.0% 100.0% Kropyvnytskyi OEP, PJSC Ukraine 99.2% 99.2% Black Sea Industries Ukraina Limited, LLC Ukraine 100.0% 100.0% Prydniprovskyi OEZ, LLC Ukraine 100.0% 100.0% Starokostiantynivskyi OEZ, LLC Ukraine 100.0% 100.0% Transbulkterminal, JV LLC Provision of grain, oil, and meals handling and transship- ment services. Ukraine 100.0% 100.0% Transgrainterminal, LLC Ukraine 100.0% 100.0% Oilexportterminal, LLC Ukraine 100.0% 100.0% Kononivsky Elevator, LLC Grain elevators. Provision of grain and oilseed cleaning, dry- ing, and storage services. Ukraine 100.0% 100.0% AF Khliborob, LLC Agricultural farms. Cultivation of agricultural products: corn, wheat, soybean, sunflower seed, rapeseed, forage, pea and barley. Ukraine 100.0% 100.0% Prydniprovskyi Krai, ALLC Ukraine 100.0% 100.0% Druzhba-Nova, ALLC Ukraine 100.0% 100.0% Druzhba 6, PE Ukraine 100.0% 100.0% Semerenky Agrofarm, LLC Ukraine 100.0% 100.0% Hovtva, ALLC Ukraine 100.0% 100.0% These consolidated financial statements were authorized for release by the board of directors of Kernel Holding S.A. on 3 October 2025. 1 As of 30 June 2025, legal ownership of Avere Commodities SA was 75.0% and economic ownership was 100.0%, out of which 37.5% are distributed under the employee profit-sharing arrangement (Note 25). Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 115 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) 2. Change in Issued Capital Since 15 June 2005, the parent company of the Group is Kernel Holding S.A. (Luxembourg). The issued capital of the Holding as of 30 June 2025, consisted of 293,429,230 ordinary shares without indication of the nominal value (30 June 2024: 293,429,230). Ordinary shares have equal voting rights and rights to receive dividends (except for own shares purchased). The shares were distributed as follows: As of 30 June 2025 As of 30 June 2024 Equity holders Shares allotted and fully paid Share owned Shares allotted and fully paid Share Owned Namsen Limited 278,947,016 95.16% 276,914,889 94.37% Free float 14,182,214 4.84% 16,514,341 5.63% Total 293,129,230 100.00% 293,429,230 100.00% As of 30 June 2025 and 30 June 2024, the Company’s immediate majority shareholder was Namsen Limited (“Namsen Ltd”) and the Group was ultimately controlled by Mr. Andrii Verevskyi. As of 30 June 2025 and 2024, 100% of the beneficial interest in Namsen Ltd was held by Mr. An- drii Verevskyi. In December 2024, the Group purchased 300,000 of its own shares (0.10% of total share capital) for USD 6,566 thousand. These shares are classified as treasury shares and deducted from equity. Treasury shares are excluded from the weighted average number of shares used to calculate earnings per share and book value per share. Luxembourg companies are required to allocate to a legal reserve a minimum of 5% of the annual net income until this reserve equals 10% of the subscribed issued capital. This reserve, in the amount of USD 775 thousand as of 30 June 2025 (30 June 2024: USD 221 thousand), may not be distributed as dividends. 3. Operating Environment On 24 February 2022, Russia launched a full-scale military invasion of Ukraine. In response, Ukraine declared martial law, which remains in effect as of the date of approval of these consolidated financial statements. Hostilities continue in the eastern and southern regions of Ukraine along the frontline, with certain towns and cities in these areas remaining temporarily occupied. Sporadic missile and drone strikes are also conducted across the country. Ukraine’s economy retains the characteristics of an emerging market. Its development is significantly influenced by fiscal and monetary policies implemented by the Government of Ukraine, as well as by changes in the legal, regulatory, and political environment, which can occur rapidly. As of June 2025, annual inflation declined to 14.3% (14.1% as of July 2025), with consumer prices influenced by adverse weather conditions affecting fruit and berry harvests, higher meat prices due to increased production costs and reduced livestock numbers, global oil price increases, and depreciation of the hryvnia against the euro. Strong consumer demand and elevated costs for raw materials and labor also contributed. While headline inflation exceeded the April macroeconomic forecast, the National Bank of Ukraine (the “NBU”) expects inflationary pressures to ease in the coming months, supported by monetary policy measures. Economic growth remains constrained by intensified air attacks and the destruction of industrial facilities, infrastructure, and housing. The NBU projects real GDP growth of 2.1% for the 2025 calendar year, with recovery dependent on the course of the war. Under the baseline scenario, the economy is expected to gradually return to normal functioning, with GDP growth of 2%–3% projected for 2026–2027. A faster normalization would support higher private investment and consumption, potentially increasing GDP growth to 3%–3.5%. Agricultural output in 2025 has been adversely affected by frosts and heavy rains between April and July, which reduced yields of grains, oilseeds, and other crops. Rapeseed harvests suffered severe frost damage in several western and central regions, leading to near-total losses in some areas. According to the Ministry of Agrarian Policy and Food of Ukraine, total grain production is forecast to decline by up to 10% and oilseed production by up to 5% compared with the 2024 period. In the first half of 2025, Ukraine continued to secure substantial external financing to address the consequences of Russian aggression. Interna- tional support covered social and humanitarian expenditures, allowing domestic fiscal resources to remain focused on security and defense. During this period, the Ministry of Finance raised USD 22 billion in external funding, including USD 17.6 billion under the Extraordinary Revenue Acceler- ation for Ukraine (ERA) initiative, which provides loans to be repaid from future revenues of immobilized Russian assets. In July 2025, an additional EUR 1 billion was secured from the EU. Other key programs included the Ukraine Facility, the Extended Fund Facility, and related initiatives. Since the beginning of the full-scale war, Ukraine’s international partners have committed more than USD 137 billion in budget support. As of July 2025, Ukraine’s international reserves amounted to USD 43.0 billion, a 4.5% decrease from June 2025, driven by NBU foreign exchange interventions and external debt repayments. Despite the decline, reserves remain sufficient to cover 4.7 months of future imports, supporting financial and exchange rate stability. To enhance financial stability, the National Bank of Ukraine (“NBU”) introduced a managed exchange rate flexibility regime in October 2023. This approach, with interventions limited to smoothing volatility, has helped reduce foreign exchange imbalances, support reserve accumulation, and strengthen the resilience of Ukraine’s economy to external influence. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 116 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) On 24 July 2025, the NBU kept its key policy rate unchanged at 15.5% (compared to 13.0% in July 2024) to support foreign exchange market stability, anchor inflation expectations, and guide inflation towards its 5% target. The NBU noted that headline inflation may temporarily rise, while core inflation is expected to continue declining, with overall inflation projected to return to a downward trajectory in the coming months. As of the date of issue of these consolidated financial statements, the war continues. The ongoing aggression by the Russian Federation increases the risk of a long-term reduction in Ukraine’s economic potential, particularly due to the loss of population, territory, and production capacity. The speed of economic recovery will depend on the duration and intensity of the conflict. Prolonged high-intensity warfare would prevent the economy from returning to normal functioning and delay inflation returning to target levels. 4. Material Accounting Policy Information Basis of Preparation and Accounting The consolidated financial statements of the Group have been prepared in accordance with IFRS Accounting Standards as adopted by the Euro- pean Union. The consolidated financial statements have been prepared under the historical cost convention, as modified by the revaluation of property, plant and equipment for the oilseeds processing segment, biological assets, agricultural produce and certain financial assets and liabilities measured at fair value. The consolidated financial statements have been prepared on a going concern basis. The Group’s Subsidiaries maintain their accounting records in local currencies in accordance with the accounting and reporting regulations of the countries of their incorporation. Local statutory accounting principles and procedures may differ from those generally accepted under IFRS Ac- counting Standards. Accordingly, the consolidated financial statements, which have been prepared from the Group’s Subsidiaries’ accounts under local accounting regulations, reflect adjustments necessary for such financial statements to be presented in accordance with IFRS Accounting Standards. Going concern The Group continues to operate in a highly challenging environment caused by Russia’s full-scale invasion of Ukraine, which began on 24 February 2022. Despite these circumstances, Kernel Group has demonstrated resilience and operational adaptability. Management has implemented measures to safeguard employees and assets while ensuring continuity of operations. In assessing the going concern assumption, the following events, conditions and results were considered for the year ended 30 June 2025 and up to the date of authorization of these consolidated financial statements: • Ukraine’s grain export processes remained stable throughout the financial year. The commercial navigation corridor, maintained by the Ukrainian Navy, ensured regular vessel traffic and uninterrupted exports of grain and oilseed products; • Despite ongoing hostilities, the Group did not incur significant damage to its core assets or facilities, and logistics operations continued without material disruption; • The Group retained its position as the largest grain exporter and sunflower oil producer in Ukraine, with production and sales volumes remaining stable despite the numerous challenges faced; • The Group’s long-term investment in renewable energy enhanced resilience against power outages. Biomass-based “green” energy project reached a combined turbine capacity of 84.4 MW, reducing reliance on external supplies and strengthening energy security; • The Group further strengthened its debt profile and liquidity position during the year, fully repaying USD 300,000 thousand of Eurobonds maturing on 17 October 2024. At the same time, short-term and long-term borrowings, including current portion, decreased by USD 61,733 thousand, while total loans outstanding amounted to USD 253,433 thousand at year-end; • For the year ended 30 June 2025, the Group generated profit after tax for the period of USD 237,596 thousand and positive net cash flows from operating activities in the amount of USD 241,664 thousand (30 June 2024: USD 167,628 thousand and USD 472,136 thousand, respectively). Management has prepared cash flow forecasts for the 12 months from the date of approval of these consolidated financial statements. In preparing these forecasts, management applied the following key assumptions: • There will be no significant further advancement of Russian troops into the territory of Ukraine and no escalation of military actions that could materially affect the Group’s assets; • Ukraine’s deep-water ports will remain open and operational during the next financial year, allowing the Group to continue its export activities. Considering the above, management has assessed the going concern assumption based on which the consolidated financial statements have been prepared. The forecast indicates that the Group has sufficient resources to continue its operations and to meet its obligations as they fall due. Accordingly, management believes that it is appropriate to prepare these consolidated financial statements on a going concern basis. Management acknowledges that the future development and duration of military actions represent a material uncertainty that may cast significant doubt on the Group’s ability to continue as a going concern and, therefore, may result in the Group being unable to realize its assets and discharge its liabilities in the normal course of business. Despite this material uncertainty related to the war in Ukraine, management continues to take actions to minimize its impact on the Group and therefore believes that the application of the going concern assumption in the preparation of these consol- idated financial statements remains appropriate. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 117 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) Adoption of New and Revised Standards The Group has adopted all new and revised IFRS Accounting Standards that became effective for annual periods beginning on or after 1 July 2024. Classification of liabilities as current or non-current (Amendments to IAS 1): The amendments aim to promote consistency in applying the requirements by helping companies determine whether, in the statement of financial position, debt and other liabilities with an uncertain settlement date should be classified as current (due or potentially due to be settled within one year) or non-current. Lease Liability in a Sale and Leaseback (Amendments to IFRS 16): Under the amendments, the seller-lessee must determine the “lease payments” or “revised lease payments” in a way that prevents the recognition of any gain or loss related to the right of use retained by the seller- lessee after the lease commencement date. Non-current Liabilities with Covenants (Amendments to IAS 1): The amendment clarifies how conditions with which an entity must comply within twelve months after the reporting period affect the classification of a liability. Supplier Finance Arrangements (Amendments to IAS 7 and IFRS 7): The amendments to IAS 7 require entities to provide disclosures regarding their supplier finance arrangements, allowing users of financial statements to evaluate how these arrangements impact the entity’s liabilities and cash flows. Additionally, IFRS 7 has been updated to include supplier finance arrangements as an example under the disclosure requirements related to an entity’s exposure to liquidity risk concentration. Standards and Interpretations Issued but not Effective At the date of authorization of these consolidated financial statements, the following standards, and interpretations, as well as amendments to the standards had been issued but were not yet effective: Standards and Interpretations Effective for the annual period beginning on or after Lack of Foreign Currency Exchangeability (Amendments to IAS 21) 1 January 2025 Contracts Referencing Nature-dependent Electricity (Amendments to IFRS 9 and IFRS 7) 1 January 2026 Classification and Measurement of Financial Instruments (Amendments to IFRS 9 and IFRS 7) 1 January 2026 Annual Improvements to IFRS Accounting Standards (Amendments to IFRS 1, IFRS 7, IFRS 9, IFRS 10 and IAS 7) 1 January 2026 Presentation and Disclosure in Financial Statements (Amendments to IFRS 18) 1 January 2027 Subsidiaries without Public Accountability: Disclosure (Amendments to IFRS 19) 1 January 2027 Management is in the process of evaluating the impact of these standards and interpretations on the Group’s consolidated financial statements in future periods. Functional and Presentation Currency The Group’s presentation currency is the United States dollar (“USD”). The functional currency of the majority of the Group’s foreign Subsidiaries is their local currency, except for businesses engaged in the production and sale of sunflower oil and export terminals, for which USD was deter- mined as the functional currency. Foreign Currencies Transactions in currencies other than the functional currencies of the Groups companies are initially recorded at the rates of exchange prevailing on the dates of the transactions. Subsequently, monetary assets and liabilities denominated in such currencies are translated at the rates prevailing on the reporting date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated. On consolidation, the assets and liabilities of the Subsidiaries are translated at exchange rates prevailing on the reporting date. Income and expense items are translated at the average exchange rates for the period, unless the exchange rates fluctuate significantly during that period, in which case the exchange rates at the dates of the transactions are used. Exchange differences arising, if any, are recognized in Consolidated Statement of Profit or Loss and Other Comprehensive Income accumulated in “Translation reserve”. The exchange rates during the period of the financial statements were as follows: Currency Closing rate as of 30 June 2025 Average rate for the year ended 30 June 2025 Closing rate as of 30 June 2024 Average rate for the year ended 30 June 2024 USD/UAH 41.6409 41.4619 40.5374 37.7892 USD/EUR 0.8525 0.9198 0.9348 0.9248 USD/PLN 3.6164 3.9227 4.0320 4.0582 Rates established by NBU might differ from the commercial rates. Therefore, these rates might not be the ones at which the assets could be realized, or liabilities could be settled. Additionally, certain restrictions of the National Bank of Ukraine (NBU) on foreign currency transactions remained in place, although they were progressively eased during the financial year, including the introduction of an investment limit mechanism in May 2025 and further liberalization measures enacted in August 2025. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 118 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) The average exchange rates for each period are calculated as the arithmetic means of the exchange rates for all trading days during this period. The sources of exchange rates are the official rates set by the National Bank of Ukraine for USD/UAH and by the National Bank of Poland for USD/EUR and USD/PLN. All foreign exchange gain or loss that occurs on revaluation of monetary balances, presented in foreign currencies, is allocated as a separate line in the Consolidated Statement of Profit or Loss. Basis of Consolidation The consolidated financial statements incorporate the consolidated financial statements of the Holding and companies controlled by the Holding (“Subsidiaries”) as of 30 June 2025. The consolidated financial statements incorporate the financial statements of the Company and entities (including structured entities) controlled by the Company and its Subsidiaries. Control is achieved when the Company: • has power over the investee; • is exposed, or has rights, to variable returns from its involvement with the investee; and • has the ability to use its power to affect its returns. The Company reassesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control listed above. When the Company has less than a majority of the voting rights of an investee, it has power over the investee when the voting rights are sufficient to give it the practical ability to direct the relevant activities of the investee unilaterally. The Company considers all relevant facts and circumstances in assessing whether or not the Company’s voting rights in an investee are sufficient to give it power, including: • the size of the Company’s holding of voting rights relative to the size and dispersion of holdings of the other vote holders; • potential voting rights held by the Company, other vote holders, or other parties; • rights arising from other contractual arrangements; • any additional facts and circumstances that indicate that the Company has, or does not have, the current ability to direct the relevant activities at the time that decisions need to be made, including voting patterns at previous shareholders’ meetings. Consolidation of a Subsidiary begins when the Company obtains control over the Subsidiary and ceases when the Company loses control of the Subsidiary. Specifically, income and expenses of a Subsidiary acquired or disposed of during the year are included in the Consolidated Statement of Profit or Loss and Other Comprehensive Income from the date the Company gains control until the date when the Company ceases to control the over Subsidiary. All inter-company transactions and balances between the Group’s enterprises are eliminated for consolidation purposes. Unrealized gains and losses resulting from inter-company transactions are also eliminated, except for unrealized losses that cannot be recovered. Non-controlling interests in Subsidiaries are identified separately from the Group’s equity therein. Non-controlling interests as of the reporting date represent the non-controlling equity holders’ portion of the fair values of the identifiable assets and liabilities of the Subsidiary at the acquisition date and the non-controlling equity holders’ portion of movements in equity since the date of acquisition. Profit or loss and each component of the other comprehensive income are attributed to the owners of the Company and to the non-controlling interests. The total comprehensive income of Subsidiaries is attributed to the equity holders of the Company and to non-controlling interests even if this results in the non-controlling interests having a deficit balance. Business Combinations Acquisitions of businesses are accounted for using the acquisition method. The consideration transferred in a business combination is measured at fair value, which is calculated as the sum of the acquisition-date fair values of the assets transferred by the Group, liabilities incurred by the Group to the former owners of the acquire and equity interests issued by the Group in exchange for control of the acquire. Acquisition costs are expensed when incurred and included in general and administrative expenses. At the acquisition date, identifiable assets acquired, and liabilities assumed are recognized at their fair value, except that: • Deferred tax assets or liabilities and liabilities or assets related to employee benefit arrangements are recognized and measured in accordance with IAS 12 Income Taxes and IAS 19 Employee Benefits, respectively; • The Group shall recognize right-of-use assets and lease liabilities for leases identified in accordance with IFRS 16 in which the acquiree is the lessee. The Group shall measure the lease liability at the present value of the remaining lease payments (as defined in IFRS 16) as if the acquired lease were a new lease at the acquisition date. The Group shall measure the right-of-use asset at the same amount as the lease liability, adjusted to reflect favorable or unfavorable terms of the lease when compared with the market; • The acquirer shall measure the value of a reacquired right recognized as an intangible asset based on the remaining contractual term of the related contract regardless of whether market participants would consider potential contractual renewals when measuring its fair value; • Liabilities or equity instruments related to share-based payment arrangements of the acquire or share-based payment arrangements of the Group entered into to replace share-based payment arrangements of the acquire are measured in accordance with IFRS 2 Share-based Payment at the acquisition date; and • Assets and liabilities that are classified as held for sale in accordance with IFRS 5 Non-current Assets Held for Sale and Discontinued Operations are measured in accordance with that standard. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 119 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) For each business combination, the Group measures the non-controlling interests in the acquiree either at fair value or at a proportionate share of the acquirer’s identifiable net assets. If the initial accounting for a business combination cannot be completed by the end of the reporting period in which the combination occurs, only provisional amounts are reported, which can be adjusted during a measurement period of 12 months after the acquisition date. Changes in the Group’s ownership interests in Subsidiaries that do not result in the Group losing control over the Subsidiaries are accounted for as equity transactions. The carrying amounts of the Group’s interests and non-controlling interests are adjusted to reflect changes in their relative interests in Subsidiaries. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consider- ation paid or received is recognized directly in equity and attributed to the equity holders of the Holding. Goodwill Goodwill arising from a business combination is recognized as an asset at the date that control is acquired (acquisition date). Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-controlling interest in the acquiree, and the fair value of the acquirer’s previously held equity interest (if any) in the entity net of the acquisition date amounts of the identifiable assets acquired and the liabilities assumed. Goodwill is not amortized but it is tested for impairment annually, or more frequently if events or changes in circumstances indicate that it might be impaired and is carried at cost less accumulated impairment losses. Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold. If, after reassessment, the net of the acquisition date amounts of the identifiable assets acquired and liabilities assumed exceeds the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree and the fair value of the acquirer’s previously held interest in the acquire (if any), the excess is recognized immediately in profit or loss as a bargain purchase gain. For impairment testing, goodwill is allocated to each of the Group’s cash-generating units (or groups of cash-generating units) (“CGU”) that are expected to benefit from the synergies of the combination. The cash-generated units or groups of units are identified at the lowest level at which goodwill is monitored for internal management purposes, being the legal entity, which represents a production site of the Group, except for the Farming segment where the whole segment is determined as one CGU and two grain export terminals which represent a single CGU. Fair Value Measurement Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either in the principal market for the asset or liability or in the absence of a principal market, in the most advantageous market for the asset or liability. The principal or most advantageous market must be accessible to the Group. The fair value of an asset or a liability is measured using the assumptions market participants would use when pricing the asset or liability, assuming that market participants act in their best economic interest. A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use. The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data is available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs. All assets and liabilities for which fair value is measured or disclosed in the consolidated financial statements are categorized within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole: • Level 1: Quoted (unadjusted) market prices in active markets for identical assets or liabilities. • Level 2: Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable. • Level 3: Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable. For assets and liabilities that are recognized in the consolidated financial statements on a recurring basis, the Group determines whether transfers have occurred between levels in the hierarchy by reassessing categorization (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period. For the transactions and activities in financial instruments, the Group could conclude enforceable master netting or similar arrangements, each agreement between the Group and the counterparty allows for net settlement of the relevant financial assets and liabilities when both elect to settle on a net basis (Note 32). In the absence of such an election, financial assets and liabilities may be settled on a gross basis, however, each party to the master netting or similar agreement will have the option to settle all such amounts on a net basis in the event of default of the other party. Per the terms of each agreement, an event of default includes failure by a party to make payment when due, failure by a party to perform any obligation required by the agreement (other than payment) if such failure is not remedied within periods of 30 to 60 days after notice of such failure is given to the party or bankruptcy. Inventories Inventories are stated at a lower cost or net realizable value. Cost comprises direct materials and, where applicable, direct labor costs and those overheads that have been incurred in bringing the inventories to their present location and condition. Cost is calculated using the first-in, first-out (FIFO) method. Net realizable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 120 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) Biological Assets and Agricultural Produce The Group classifies crops in fields and cattle as biological assets. Biological assets are stated at fair value, less estimated costs to sell at both initial recognition and as of the reporting date, with any resulting gain or loss recognized in the Consolidated Statement of Profit or Loss. Costs of selling include all costs that would be necessary to sell the assets, including costs necessary to get the assets to the market. Agricultural produce harvested from biological assets is measured at its fair value less costs to sell estimated at the point of harvest. A gain or loss arising from the initial recognition of agricultural produce at fair value less costs to sell is included in the Consolidated Statement of Profit or Loss. The Group presents gain/(loss) on revaluation attributable to the agricultural produce sold during the year in the Net change in fair value of biological assets and agricultural produce. Biological assets for which quoted market prices are not available are measured using the present value of expected net cash flows from the sale of an asset discounted at a current market-determined rate. The objective of a calculation of the present value of expected net cash flows is to determine the fair value of a biological asset in its present location and condition. The cost of agricultural preparation of fields before seeding is recorded as work-in-progress in inventories. After seeding, the cost of field preparation is recognized as biological assets held at fair value less costs to sell. The Group classifies biological assets as current or non-current depending upon the average useful life of the group of biological assets. All of the Group’s biological assets except non-current cattle were classified as current, as their average useful life is less than one year. Property, Plant, and Equipment Buildings, constructions, production machinery and equipment (Oilseed Processing segment) are accounted for at revalued amounts, being the fair value, which is determined using external professional expert evaluation. Revaluations are performed with sufficient regularity such that the carrying amount does not differ materially from that which would be determined using fair values at the reporting date. Any accumulated deprecia- tion at the date of revaluation is eliminated against the gross carrying amount of the asset, and the net amount is restated to the revalued amount of the asset. If the asset’s carrying amount is increased as a result of a revaluation, the increase is credited directly to other comprehensive income and accu- mulated in the revaluation reserve in equity. However, such an increase is recognized in the Consolidated Statement of Profit or Loss to the extent that it reverses an impairment of the same asset previously recognized in the Consolidated Statement of Profit or Loss. If the asset’s carrying amount is decreased as a result of a revaluation, the decrease is recognized in the Consolidated Statement of Profit or Loss. However, such a decrease is debited directly to the Other Comprehensive Income or Loss to the extent of any credit balance existing in the revaluation surplus with respect to that asset. Depreciation on revalued assets is charged to the Consolidated Statement of Profit or Loss. On the subsequent sale or retirement of revalued assets, the revaluation surplus remaining in the revaluation reserve is transferred directly to retained earnings. No transfer is made from the revaluation reserve to retained earnings except when an asset is derecognized. Property, plant and equipment are depreciated over the estimated useful economic lives of assets under the straight-line method. Useful lives of property, plant, and equipment are as follows: Buildings and constructions 20 - 50 years Production machinery and equipment 10 - 20 years Agricultural equipment and vehicles 5 - 30 years Other fixed assets 5 - 20 years Construction in progress (CIP) and uninstalled equipment not depreciated Except for land, buildings and constructions and production machinery and equipment of the Oilseed Processing segment, all other property, plant and equipment is stated at historical cost less accumulated depreciation and accumulated impairment losses. Land is carried at cost less accumu- lated impairment losses and is not depreciated. Capitalized costs include major expenditures for improvements and replacements that extend the useful lives of assets or increase their revenue- generating capacity. Repairs and maintenance expenditures that do not meet the foregoing criteria for capitalization are presented in the Consoli- dated Statement of Profit or Loss as incurred. Construction in progress consists of costs directly related to the construction of property, plant and equipment including an appropriate allocation of directly attributable variable overhead incurred during construction. Depreciation of these assets commences when the assets are put into operation. An item of property, plant and equipment is derecognized upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss arising from the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognized in the Consolidated Statement of Profit or Loss. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 121 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) Leases The Group assesses whether a contract is, or contains, a lease at the inception of the contract. The Group recognizes right-of-use assets and corresponding lease liabilities with respect to all lease arrangements in which it is the lessee, except for short-term leases (defined as leases with a lease term of 12 months or less). For the short-term leases, the Group recognizes the lease payments as an operating expense on a straight-line basis over the term of the lease unless another systematic basis is more representative of the time pattern in which economic benefits from the leased assets are consumed. The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted by using the incremental borrowing rate. The incremental borrowing rate is determined as reference interest rates which were derived from the yields of corporate bonds in the currency similar to the lease contracts, for a period of up to 10 years. Lease payments included in the measurement of the lease liability comprise: • Fixed lease payments (including in-substance fixed payments), less any lease incentives receivable: • Variable lease payments that depend on an index or rate, initially measured using the index or rate at the commencement date; • The amount expected to be payable by the lessee under residual value guarantees. • The exercise price of purchase options, if the lessee is reasonably certain to exercise the options; and • Payments of penalties for terminating the lease, if the lease term reflects the exercise of an option to terminate the lease. • The lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be readily determined, which is generally the case for leases of the Group, the Group’s incremental borrowing rate is used, being the rate that the Group would have to pay to borrow the funds necessary to obtain an asset of similar value to the right-of-use asset in a similar economic environment with similar terms, collateral, and conditions. • To determine the incremental borrowing rate, the Group: − where possible, uses recent third-party financing received by the Group as a starting point, adjusted to reflect changes in financing conditions since third party financing was received, − uses a build-up approach that starts with a risk-free interest rate adjusted for credit risk, and − adjusts specific to the lease, e.g., term, country, currency, and collateral The Group remeasures the lease liability (and makes a corresponding adjustment to the related right-of-use asset) whenever: • The lease term has changed or there is a significant event or change in circumstances resulting in a change in the assessment of exercise of a purchase option, in which case the lease liability is remeasured by discounting the revised lease payments using a revised discount rate. • The lease payments change due to changes in an index or rate or a change in expected payment under a guaranteed residual value, in which cases the lease liability is remeasured by discounting the revised lease payments using an unchanged discount rate (unless the lease payments change is due to a change in a floating interest rate, in which case a revised discount rate is used). • A lease contract is modified, and the lease modification is not accounted for as a separate lease, in which case the lease liability is remeasured based on the lease term of the modified lease by discounting the revised lease payments using a revised discount rate at the effective date of the modification. The right-of-use assets comprise the initial measurement of the corresponding lease liability, lease payments made at or before the commencement day, any lease incentives received, and any initial direct costs. Right-of-use assets are depreciated on a straight-line basis from the commencement date of the lease. The commencement date is the date on which a lessor makes an underlying asset available for use by a lessee. The right-of-use assets and lease liabilities are presented as separate lines in the consolidated statement of financial position. Finance costs, which represent the difference between the total lease payments included in the measurement of the lease liability and the initial amount of the lease liability, are charged to profit or loss over the term of the relevant lease so as to produce a constant periodic rate of charge on the remaining balance of the obligations for each accounting period. Intangible Assets Intangible assets with finite useful lives that are acquired separately are carried at cost less accumulated depreciation and accumulated impairment losses. Amortization is primarily recognized within “Cost of Sales” on a straight-line basis over their estimated useful lives. The amortization method and estimated useful life are reviewed annually with the effect of any changes in estimate being accounted for on a prospective basis. Intangible assets with indefinite useful lives that are acquired separately shall not be amortized and are carried at cost less accumulated impairment loss. Trademarks The “Schedry Dar”, “Stozhar”, “Zolota” and “Domashnya” are separately acquired trademarks that have indefinite useful lives and are not amortized but tested for impairment by comparing their recoverable amount with their carrying amount annually on 30 June and whenever there is an indication that the trademarks may be impaired. Impairment of tangible and intangible assets, except Goodwill On each reporting date, the Group reviews the carrying amounts of the Group’s non-current assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the assets is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the Group Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 122 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) estimates the recoverable amount of the cash-generating unit to which the asset belongs. The recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted. If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than it is carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. The cash generating unit represents the lowest level within the Group at which the goodwill is monitored by management and which is not larger than a segment. An impairment loss is recognized immediately in the Consolidated Statement of Profit or Loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease. Where an impairment loss subsequently reverses, the carrying amount of the asset (or a cash-generating unit) is increased to the revised estimate of its recoverable amount to the extent that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognized immediately in the Consolidated Statement of Profit or Loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase. Cash and cash equivalents Cash and cash equivalents include cash in hand, and deposits held with banks with original maturities of three months or less. Cash and cash equivalents are carried at amortized cost because: (i) they are held for collection of contractual cash flows and those cash flows represent SPPI, and (ii) they are not designated at FVTPL. Restricted balances are excluded from cash and cash equivalents for the consolidated statement of cash flows. Financial Instruments Financial assets and financial liability are recognized in the Group’s Consolidated Statement of Financial Position when, and only when, the Group entity becomes a party to the contractual provisions of the instrument. Financial assets are classified into the following categories financial assets at amortized cost or at fair value through profit or loss (FVTPL). The classification depends on the business model and contractual cash flow characteristics of the financial assets or financial liabilities and is deter- mined at the time of initial recognition. Financial assets and financial liabilities are initially measured at fair value, except for trade receivables and trade payables that do not have a significant financing component which are measured at transaction price. All recognized financial assets are measured subsequently in their entirety at either amortized cost or fair value, depending on the classification of the financial assets. All financial liabilities are measured subsequently at amortized cost using the effective interest method or at FVTPL. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acqui- sition of financial assets or financial liabilities at fair value through profit or loss are recognized immediately in profit or loss. Cash flows arising from the trading of government bonds are presented on a net basis within investing activities, as these represent non-core, non- revenue generating transactions undertaken under a distinct trading model. The government bonds held by the Group are measured at fair value through profit or loss (FVTPL) in accordance with IFRS 9. The classification is based on the Group’s business model, as these instruments are not held solely to collect contractual cash flows, nor are they held both to collect contractual cash flows and to sell. Amortized cost and effective interest method The Group measures financial assets at amortized cost if both of the following conditions are met: • The financial asset is held within a business model with the objective of holding financial assets in order to collect contractual cash flows; and • The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Financial assets at amortized cost are subsequently measured using the effective interest method and are subject to impairment. Gains and losses are recognized in profit or loss when the asset is derecognized, modified or impaired. The effective interest method calculates the amortized cost of a debt instrument and allocates interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts (including all fees and points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the debt instrument, or, where appro- priate, a shorter period, to the net carrying amount on initial recognition. Interest income is recognized on an effective interest basis for debt instruments other than those financial assets classified as at fair value through profit or loss. The effect of initial recognition of financial assets and liabilities obtained/incurred at terms below the market is recognized net of the tax effect as an income or expense, except for financial assets and liabilities with shareholders or entities under control of the Beneficial Owner, whereby the effect is recognized through equity. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 123 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) Financial assets at FVTPL Financial assets that do not meet the criteria for being measured at amortized cost are measured at FVTPL. Specifically: • Investments in equity instruments are classified as at FVTPL on initial recognition; • Debt instruments that do not meet the amortized cost criteria are classified as at FVTPL. In addition, debt instruments that meet either the amortized cost criteria may be designated as at FVTPL upon initial recognition if such designation eliminates or significantly reduces a meas- urement or recognition inconsistency (so called “accounting mismatch”) that would arise from measuring assets or liabilities or recognizing the gains and losses on them on different bases. The Group has not designated any debt instruments as at FVTPL. Financial assets at FVTPL are measured at fair value at the end of each reporting period, with any fair value gains or losses recognized in profit or loss to the extent they are not part of a designated hedging relationship. The net gain or loss recognized in profit or loss includes any dividend or interest earned on the financial asset. Derecognition of financial assets The Group derecognizes a financial asset when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and all the risks and rewards to another entity. If the Group neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the Group recognizes its retained interest in the asset and associated liability for amounts it may have to pay. If the Group retains substantially all the risks and rewards of ownership of a transferred financial asset, the Group continues to recognize the financial asset and also recognizes collateralized borrowing for the proceeds received. On derecognition of a financial asset other than in its entirety (e.g. when the Group retains an option to repurchase part of a transferred asset or retains a residual interest that does not result in the retention of substantially all the risks and rewards of ownership and the Group retains control), the Group allocates the previous carrying amount of the financial asset between the part it continues to recognize under continuing involvement, and the part it no longer recognizes based on of the relative fair values of those parts on the date of the transfer. The difference between the carrying amount allocated to the part that is no longer recognized and the sum of the consideration received for the part no longer recognized and any cumulative gain or loss allocated to it that had been recognized in other comprehensive income is recognized in the Consolidated Statement of Profit or Loss. A cumulative gain or loss that had been recognized in other comprehensive income is allocated between the part that continues to be recognized and the part that is no longer recognized based on the relative fair values of those parts. Impairment of financial assets The Group recognizes a loss allowance for expected credit losses (“ECL”) on a financial asset, other than those at FVTPL, at the end of each reporting period. The amount of ECL and other current assets is updated at each reporting date to reflect changes in credit risk since the initial recognition of the respective financial instrument. The Group applies a simplified approach permitted by IFRS Accounting Standards to measuring ECL which uses a lifetime expected loss allowance for trade receivables. The ECL on trade receivables and other current assets is estimated using a provision matrix, based on historical credit loss experience and credit rating of customers, adjusted on observable and reasonable information. Lifetime ECL represents the expected credit losses that will result from all possible default events over the expected life of a financial instrument. In contrast, 12-month ECL represents the portion of lifetime ECL that is expected to result from default events on a financial instrument that are possible within 12-months after the reporting date. The Group writes off a financial asset when there is information indicating that the debtor is in severe financial difficulty and there is no realistic prospect of recovery, e.g. when the debtor has been placed under liquidation or has entered bankruptcy proceedings, or in the case of trade accounts receivable, when the amounts are over three years past due, whichever occurs sooner. Financial assets written off may still be subject to enforcement activities under the Group’s recovery procedures, considering legal advice where appropriate. Any recoveries made are recognized in profit or loss. Definition of default The Group considers the following as constituting an event of default for internal credit risk management purposes as historical experience indicates that financial assets that meet either of the following criteria are generally not recoverable: • when there is a breach of financial covenants by the debtor; or • information developed internally or obtained from external sources indicates that the debtor is unlikely to pay its creditors, including the Group, in full (without taking into account any collateral held by the Group). Irrespective of the above analysis, the Group considers that default has occurred when a financial asset is more than 90 days past due unless the Group has reasonable and supportable information to demonstrate that a more lagging default criterion is more appropriate. Financial liabilities measured subsequently at amortized cost Financial liabilities that are not (i) contingent consideration of an acquirer in a business combination, (ii) held for trading, or (iii) designated as at FVTPL, are measured subsequently at amortized cost using the effective interest method. Financial liabilities include balances of bank loans and credit lines. Cash movements from bank loans and credit lines, which meet requirements of IAS 7 for net presentations are presented in the consolidated statements of cash flows in line “Net proceeds from/(repayment of) credit lines”. Other related cash movements, which do not meet requirements for net presentation are presented on gross basis in lines “Proceeds from short-term and long-term borrowings” and “Repayment of short-term and long-term borrowings”. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 124 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) Financial liabilities at FVTPL Financial liabilities are classified as at FVTPL when the financial liability is (i) contingent consideration of an acquirer in a business combination, (ii) held for trading or (iii) it is designated as at FVTPL. A financial liability is classified as held for trading if: • it has been acquired principally for the purpose of repurchasing it in the near term; or • on initial recognition it is part of a portfolio of identified financial instruments that the Group manages together and has a recent actual pattern of short‑term profit‑taking; or • it is a derivative, except for a derivative that is a financial guarantee contract or a designated and effective hedging instrument. A financial liability other than a financial liability held for trading or contingent consideration of an acquirer in a business combination may be designated as at FVTPL upon initial recognition if: • such designation eliminates or significantly reduces a measurement or recognition inconsistency that would otherwise arise; or • the financial liability forms part of a group of financial assets or financial liabilities or both, which is managed, and its performance is evaluated on a fair value basis, in accordance with the Group’s documented risk management or investment strategy, and information about the grouping is provided internally on that basis; or • it forms part of a contract containing one or more embedded derivatives, and IFRS 9 permits the entire combined contract to be designated as at FVTPL. Financial liabilities at FVTPL are measured at fair value, with any gains or losses arising on changes in fair value recognized in profit or loss to the extent that they are not part of a designated hedging relationship. The net gain or loss recognized in profit or loss incorporates any interest paid on financial liability. However, for financial liabilities that are designated as at FVTPL, the amount of change in the fair value of the financial liability that is attributable to changes in the credit risk of that liability is recognized in other comprehensive income, unless the recognition of the effects of changes in the liability’s credit risk in other comprehensive income would create or enlarge an accounting mismatch in profit or loss. The remaining amount of change in the fair value of liability is recognized in profit or loss. Changes in fair value attributable to a financial liability’s credit risk that is recognized in other comprehensive income are not subsequently reclassified to profit or loss; instead, they are transferred to retained earnings upon derecog- nition of the financial liability. Derecognition of financial liabilities The Group derecognizes financial liabilities when, and only when, the Group’s obligations are discharged, cancelled or have expired. The difference between the carrying amount of the financial liability derecognized and the consideration paid and payable is recognized in profit or loss. When the Group exchanges with the existing lender one debt instrument into another one with the substantially different terms, such exchange is accounted for as an extinguishment of the original financial liability and the recognition of a new financial liability. Similarly, the Group accounts for substantial modification of terms of an existing liability or part of it as an extinguishment of the original financial liability and the recognition of a new liability. It is assumed that the terms are substantially different if the discounted present value of the cash flows under the new terms, including any fees paid net of any fees received and discounted using the original effective rate is at least 10 per cent different from the discounted present value of the remaining cash flows of the original financial liability. If the modification is not substantial, the difference between: 1. the carrying amount of the liability before the modification; and 2. the present value of the cash flows after modification should be recognized in the statement profit or loss as the modification gain or loss within other operating income and expenses. Derivative Financial Instruments The Group enters a variety of derivative financial instruments including futures, options, and physical contracts to buy or sell commodities, which do not qualify for the “own use” exemption under IFRS 9. These instruments are used primarily for economic risk management and pricing purposes. All derivatives are initially recognized at fair value on the date the contract is entered into and are subsequently remeasured at fair value at each reporting period. The resulting gain or loss is recognized immediately in the profit or loss within Cost of sales (for the derivative purchase contracts) or gains or losses from sales-related derivatives are reflected in Other operating expenses or income. Fair value is determined using quoted market prices, third-party broker quotations, or appropriate valuation techniques when observable inputs are not available. Derivatives expected to be settled within a year after the end of the reporting period are classified as current liabilities or current assets. If settlement is expected beyond one year, the instrument is classified as non-current. Treasury shares Own equity instruments held by the Group (“Treasury shares”) shall be deducted from equity. No gain or loss shall be recognized in profit or loss on the purchase, sale, issue, or cancellation of the Group’s own equity instruments. These treasury shares may be acquired and held by the entity or by other members of the Group. Any difference between the carrying amount and the consideration, if reissued, will be recognized in the share premium reserve. Provisions A provision is recognized in the Consolidated Statement of Financial Position when the Group has a legal or constructive obligation because of a past event, and it is probable that an outflow of economic benefits will be required to settle the obligation, and a reliable estimate of the obligation Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 125 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) amount can be made. The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation at the reporting date, considering the risks and uncertainties surrounding the obligation. Revenue recognition Revenue is derived principally from the sale of goods and finished products, farming and rendering services. Revenue from contracts with custom- ers is recognized when control of the goods or services is transferred to the customer at an amount that reflects the consideration to which the Group expects to be entitled in exchange for those goods or services. The point of revenue recognition for sale of commodity goods is dependent upon contract sales terms (Incoterms). When goods are sold on a Cost and freight (CFR) or Cost, insurance, and freight (CIF) basis, the Group is responsible for providing services such as carriage and freight to the customer. The Group recognizes revenue from each separate performance obligation and allocates part of the transaction price to carriage and freight services incorporated in some contracts that the Group undertakes to perform. The Group allocates the transaction price based on the relative stand-alone selling prices of the commodities and supporting services. The revenue from these carriage and fright services is recognized over time. A receivable is recognized by the Group when the control over goods is transferred to the wholesaler as this represents the point of time at which the right to consideration becomes unconditional, as only the passage of time is required before payment is due. The timing of billing is generally close to the timing of performance obligation satisfaction, respectively, the amount of contract assets and contract liabilities is not material. When the Group obtains a contract from a customer, the Group enters into a contract with one of those service providers, directing the service provider to render freight and other services for the customer. The Group is obliged to pay the service provider even if the customer fails to pay. Revenue derived from freight, storage and other services is recognized over time, as the customers simultaneously receive and consume the benefits provided by the Group in respect of the related services. This recognition method is consistent with the revenue disclosures presented for each reportable segment. Revenue, as well as other transactions and balances with other related parties, are incurred with legal entities that are associated with close family members of the ultimate controlling party of the Group and members of the Group’s management. Employee benefits Wages, salaries, contributions to the pension and social insurance funds, paid annual leave and sick leave, bonuses, and non-monetary benefits are accrued in the year in which the associated services are rendered by the employees of the Group. The Group recognizes a liability and an expense for short-term bonuses and other short-term profit-sharing arrangements when the reporting entity has a present legal or constructive obligation to make payments as a result of past events and a reliable estimate can be made of the amount payable. Borrowing Costs Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period to get ready for their intended use or sale, are added to the cost of those assets, until the assets are substantially ready for their intended use or sale. All other borrowing costs are recognized in the Consolidated Statement of Profit or Loss in the period in which they are incurred. Taxation Income taxes have been provided for in the consolidated financial statements in accordance with legislation currently enacted in the legal jurisdic- tions where the operating entities are located. Income tax expense represents the sum of the tax currently payable and deferred tax expense. Current and deferred tax for the year Current and deferred tax are recognized in the Consolidated Statement of Profit or Loss, except when they relate to items that are recognized in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognized in other comprehensive income or directly in equity, respectively. Where current tax or deferred tax arises from the initial accounting for a business combination, the tax effect is included in the accounting for the business combination. Current tax The current income tax charge is the amount expected to be paid to, or recovered from, taxation authorities with respect to taxable profit or losses for the current or previous periods. It is calculated using tax rates that have been enacted or substantially enacted by the reporting date in the countries where the Holding and its Subsidiaries operate and generate taxable income. Taxable profit differs from “profit before tax” because of items of income or expense that are taxable or deductible in other years and items that are never taxable or deductible taxes other than income tax are recorded within operating expenses. Some of the Group’s companies that are involved in agricultural production are exempt from income taxes and pay the Unified Agricultural Tax instead. Deferred tax Deferred income tax is recognized on temporary differences arising between the carrying amount of assets and liabilities in the financial statements and their corresponding tax bases used in the computation of taxable profit. Deferred tax balances are measured at tax rates enacted or substan- tively enacted at the end of the reporting period that are expected to apply to the period when the temporary differences will reverse, or the tax loss carried forward will be utilized. Deferred tax assets for deductible temporary differences and tax losses carried forward are recorded only to the extent that it is probable that future taxable profit will be available against which the deductions can be utilized. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 126 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the assets to be recovered. Deferred tax liabilities for taxable temporary differences associated with investments in Subsidiaries and joint ventures are recognized, except when the Group can control the reversal of the temporary difference, and it is probable that the temporary difference will not reverse in the fore- seeable future. In addition, a deferred tax liability is not recognized if the temporary difference arises from the initial recognition of goodwill. Deferred tax assets and liabilities are offset when: • The Group has a legally enforceable right to set off the recognized amounts of current tax assets and current tax liabilities; • The Group has the intention to settle on a net basis, or to realize the asset and settle the liability simultaneously; • The deferred tax assets and the deferred tax liabilities relate to income taxes levied by the same taxation authority in each future period in which significant amounts of deferred tax liabilities and assets are expected to be settled or recovered. Share-based options and payments The Group recognizes a compound financial instrument if an entity has granted the counterparty the right to choose whether a share-based payment transaction is settled in cash or by issuing equity instruments, which includes a debt component (i.e. the counterparty’s right to demand payment in cash) and an equity component (i.e. the counterparty’s right to demand settlement in equity instruments rather than in cash). The Group measures the debt component of the compound financial instrument first and then measures the fair value of the equity component, considering that the counterparty must forfeit the right to receive cash in order to receive the equity instrument. The fair value of the compound financial instrument is determined as the sum of the fair values of the two components. For cash-settled share-based payments, a liability is initially recognized for the goods or services acquired, measured initially at the fair value of the liability. At each reporting date until the liability is settled, and at the date of settlement, the fair value of the liability is remeasured, with any changes in fair value recognized in in the Consolidated Statement of Profit or Loss for the year. Corrections and reclassifications In accordance with IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors, the Group has made corrections and reclassifications in the comparative financial information as of 30 June 2024 presented in these consolidated financial statements for the year ended 30 June 2025. Notes to the consolidated financial statements: • Note 14 Property, plant and equipment – amounts in the columns “Cost as of 30 June 2024” and “Accumulated depreciation and impairment losses as of 30 June 2024” were reduced by USD 53,328 thousand and USD 63,242 thousand, within the lines “Buildings and constructions” and “Production machinery and equipment” respectively, to correct presentation of impairment loss of items carried under the revaluation model. • Note 31 Financial risk management – was corrected to add remaining contractual cashflows until maturity for its derivative financial liabilities related to swap contracts. Additionally, the Group added amounts of its exposure to foreign currency risk to include transactions with currency swap contracts. The correction was necessary to meet IFRS 7 disclosure requirement. • Note 32 Financial instruments - was corrected to enhance presentation of derivative financial instruments subject to offsetting and to exclude certain balances of derivatives financial instruments, which are not subject to offsetting. • The Group’s revenue by type of goods was presented in Note 7 Revenue and Key Data by Operating Segment to enhance alignment of revenue presentation by products and segments. In the consolidated statement of cash flows, reclassifications were made to correct presentation of cash flows within financing activities. For the year ended 30 June 2024, the Group introduced new lines “Net proceeds from/(repayment of) credit lines” of USD 35,319 thousand for fast-moving loans, “Proceeds from short-term and long-term borrowings” of USD 109,463 thousand and “Repayment of short-term and long-term borrowings” of USD 619,580 thousand instead of “Proceeds from borrowings” and “Repayment of borrowings” of USD 245,019 thousand and USD 790,455 thousand, respectively. 5. Critical Accounting Judgments and Key Sources of Estimation Uncertainty The application of IFRS Accounting Standards requires management to make reasonable judgments, assumptions and estimates. These estimates and assumptions affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements. The estimates are based on the information available as of the reporting date. Actual results could differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods. Critical Judgments in Applying Accounting Policies The following are the critical judgments, apart from those involving estimations (see below), that management has made in the process of applying the Group’s accounting policies and that have the most significant effect on the amounts recognized in the consolidated financial statements. Revaluation of Property, Plant and Equipment The Group recognizes the buildings, constructions, production machinery, and equipment used in the Oilseed Processing segment at fair value, which is valued by external independent appraiser, at least triennially or more often, depending on the external and internal factors. A revaluation surplus is credited to Revaluation reserve within equity. All other classes of property, plant and equipment are recognized at historical cost less depreciation. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 127 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) As of 30 June 2025, the Group performed a revaluation of the buildings, constructions, production machinery, and equipment used in the Oilseed Processing segment, which are carried out at fair value. Valuation was conducted in accordance with International Valuation Standards and Inter- national Financial Reporting Standard 13 “Fair Value Measurement”. While performing valuation the following techniques were used: • Cost approach (depreciated replacement cost); • Income approach (discounted cash flow models). The Group involved an independent appraiser to identify the depreciated replacement cost of assets, while discounted cash flow models were prepared by the internal valuation team and technicians. The depreciated replacement cost was calculated as either cost to reproduce the asset adjusted by the observable inflation rate and change in currency exchange rates or cost of a new market analogue both adjusted by unobservable index of physical depreciation. The higher the cost to reproduce the asset or cost of a new market analogue, the higher the depreciated replacement cost. Key assumptions used in depreciated replacement cost (“DRC”) as well as their sensitivities are outlined as follows: Description DRC as of 30 June 2025 Value tech- niques Fair value hierarchy Unobservable inputs Range of unobservable inputs (weighted average) Relationship of unobservable in- puts to DRC Buildings and con- structions 276,471 Depreciated re- placement cost Level 3 Index of physi- cal depreciation 1 – 80% (21%) The higher the index of physical de- preciation, the lower the DRC Production machin- ery and equipment 226,854 Depreciated re- placement cost Level 3 Index of physi- cal depreciation 5 – 82% (19%) The higher the index of physical de- preciation, the lower the DRC If the above unobservable inputs to the valuation model were 5 p. p. higher/lower while all other variables were held constant, the DRC of the buildings and constructions and production machinery and equipment would decrease/increase by USD 39,119 thousand and USD 38,970 thousand, respectively. The results of revaluation using the depreciated replacement cost were then compared with results of income approach (Level 3 of unobservable inputs) for corresponding assets to test whether economic obsolescence exists. Cash flow forecasts used in the income approach were based on financial budgets approved by management covering a five-year period. Cash flows beyond the five-year period were extrapolated using the estimated growth rates. Other key assumptions used in the discounted cash flow forecasts, and their sensitivity is disclosed in Note 14. Key sources of estimation uncertainty The following are the key assumptions concerning the future and other key sources of estimating uncertainty at the end of the reporting period that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year. Impairment of Property, Plant and Equipment The Group assesses non-financial assets for indicators of impairment at each reporting date. Where such indicators exist, or where there are indications that a previously recognized impairment may no longer exist or may have decreased, management performs a detailed impairment review of the Group’s non-current assets. Management makes key assumptions regarding factors that have been materially influenced by the full-scale Russian invasion of Ukraine. These assumptions reflect events and conditions that may indicate impairment, including: • temporary suspension of operations; • breaches of supply and purchase contracts; • restrictions on market access for product deliveries; • limitations on export routes; • declines in profitability and physical damage to assets resulting from the invasion; and • volatility in commodity prices, including consideration of future pricing trends, where fluctuations of 5–10% are common in the industry. The Group tested its non-current assets for impairment by comparing their carrying amounts with their recoverable amounts, defined as the higher of value in use and fair value less costs of disposal. Impairment testing was performed at the cash-generating unit (“CGU”) level for all segments, covering property, plant and equipment, intangible assets, right-of-use assets, and goodwill. Where impairment was identified, the loss was allocated first to goodwill and then to other intangible assets, property, plant and equipment, and right-of-use assets on a pro rata basis. In assessing for impairment, assets that do not generate independent cash flows are allocated to the appropriate cash-generating unit. The recoverable amount was determined primarily on a value-in-use basis, using discounted cash flow projections. Future cash flows were esti- mated from financial budgets approved by management covering a five-year period, and extrapolated beyond this period using growth rates con- sistent with industry forecasts. The cash flows were discounted to present value using pre-tax discount rates that reflect the specific risks associated with the relevant CGUs, their functional currency, and the country of operation. Key assumptions and sensitivities are disclosed in Note 14. For previously impaired assets or CGUs, if the recoverable amount exceeds the carrying amount, the impairment loss is reversed in the consoli- dated statement of profit or loss. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 128 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) Impairment of Right of Use Assets The Group allocated the right of use assets to a cash generating unit, for impairment test within the respective CGU. The majority of the Group’s right-of-use assets relate to leasehold land for agricultural purposes, being part of the Farming segment. Details of the management assumptions used to assess the recoverable amount of cash-generating units in which right of use assets were allocated are provided in Note 5 under the Impairment of Property, Plant and Equipment section and Note 14. Functional currencies of different entities of the Group Different entities within the Group have different functional currencies, based on the underlying economic conditions of their operations. This determination of what the specific underlying economic conditions require judgment. In making this judgment, the Group evaluates among other factors, the location of activities, the sources of revenue and risks associated with activities, denomination of currencies of operations of different entities and degree of independence of subsidiaries’ business model. Specifically, in determination of the functional currencies of Kernel Trade LLC, the Group based its judgement on the fact that the company operates internationally on the markets mainly influenced by the US Dollar (not Ukrainian Hryvnia) and its major activities include the sale of goods to foreign customers. Moreover, most of its operations are denominated in US Dollars and also, the US Dollar is the currency in which its business risks and exposures are managed, and the performance of their business is measured. In determining the functional currency of the oil-processing plants and transshipment terminals, the Group based its judgement on the degree of independence of those companies’ business model of Kernel Trade LLC. Fair Value of Biological Assets and Agricultural Produce Biological assets are recorded at fair value less costs to sell. The fair value of growing crops is determined using a discounted cash flow model based on the expected crops’ yield by sowing area size, the market price for respective crops, and after allowing for harvesting costs, contributory asset charges for the land and sowing areas and other costs yet to be incurred in getting the harvest to maturity. The Group estimates the fair values of biological assets and agricultural produce based on the following assumptions: • Expected crop yields (for crops in fields); • Average weight and quality of animals; • Productive life of one milk cow; • Estimated future sales prices; • Projected production costs and costs to sell; and • Discount rate. Although some of these assumptions are obtained from published market data, a majority of these assumptions are estimated based on the Group’s historical and projected results (Note 12). 6. Operating Segments Operating segments are reported in a manner consistent with the internal reporting as provided to the chief operating decision-makers for the purpose of allocating resources and assessing performance. The executive management, who are members of the Board of Directors of the Company, are identified as chief operating decision makers. For the purposes of the consolidated financial statements, operating segments are defined based on the nature of activities, products sold, or services provided. The segmentation presented consists of the structure of financial information regularly reviewed by the Group’s executive man- agement, including the Chief Executive Officer. Segment performance is evaluated primarily on the basis of “EBITDA” (Earnings Before Interest, Taxes, Depreciation, and Amortization. EBITDA is calculated as the profit from operating activities adding back amortization and depreciation. The Group presents its results of activities within three operating segments: • Oilseed Processing combines oilseed origination, edible oil production and sales of bottled sunflower oil. Sunflower oil in bulk is mostly sold further to the Infrastructure and Trading segment for global marketing. • Infrastructure and Trading segment, the Group combines results of Avere's global physical and proprietary trading operations, silo services, transportation and logistics assets, export terminals, vessels, grain origination, and export operations in Ukraine. This segment comprises inter- connected business units that together form an integrated supply chain linking Ukrainian farmers to global markets. Management treats export terminals and grain storage facilities as production assets that support the grain merchandising business. • Farming segment, the Group reports result of its crop production business, which includes growing corn, wheat, soybean, sunflower seed, and rapeseed on the leasehold land, as well as some minor crops and small cattle farming operations. The measures of profit and loss, and assets and liabilities are based on the Group accounting policies, which comply with IFRS Accounting Stand- ards, as adopted by the European Union. Reconciliation eliminates intersegment items. The data of segments is calculated as follows: • Intersegment sales reflect intergroup transactions effected on an arm’s length basis. • Capital expenditures, amortization and depreciation related to property, plant and equipment, and intangible assets are allocated to segments when possible. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 129 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) The “Other” column reflects income and expenses not allocated to segments, which are related to the administration function of the Group. Since the financial management of the Group’s companies is carried out centrally, borrowings, bonds, deferred taxes, and some other assets and liabilities are not allocated directly to the respective operating segments and are presented in the “Other” column. Consequently, the assets and liabilities shown for individual segments do not include borrowings, bonds, deferred taxes, and some other assets and liabilities. Seasonality of operations The Oilseed Processing segment typically experiences seasonally lower sales in the first quarter of the financial year, corresponding to the end of the crushing season and reduced production levels. The Farming segment reflects seasonality associated with seeding and harvesting cam- paigns, which generally occur from November to May and June to November, respectively. The Infrastructure and Trading segment usually rec- ords higher volumes in the months following the start of the harvesting campaign (July for early grains and September for autumn-harvested crops). Additionally, the Farming segment is generally subject to a greater impact from IAS 41 valuation of biological assets in the last quarter of the financial year, when more acreage is revalued at fair value less costs to sell. A significant effect from IAS 41 valuation of agricultural produce is also typically observed in the first half of the financial year, following the completion of the harvesting campaign. 7. Revenue and Key Data by Operating Segment Key data by operating segment for the year ended 30 June 2025: Oilseed Processing Infrastructure and Trading Farming Other Reconciliation Total Revenue (external) 2,047,930 2,021,729 45,383 — — 4,115,042 Intersegment sales 58,719 147,079 422,822 — (628,620) — Total revenue 2,106,649 2,168,808 468,205 — (628,620) 4,115,042 Net change in fair value of biological assets and agricultural produce — — 6,590 — — 6,590 Cost of sales (2,003,675) (1,875,575) (302,543) — 628,620 (3,553,173) Other operating income 14,437 13,571 5,841 33,959 — 67,808 Other operating expenses — — (2,673) (43,741) (46,414) General and administrative expenses (12,993) (117,683) (27,709) (76,883) — (235,268) Net reversal of impairment losses/(impairment) on financial assets 486 (1,917) (950) (104) — (2,485) Reversal of impairment losses/(impairment) on assets 8,022 1,894 50 (1,020) — 8,946 Profit/(loss) from operating activities 112,926 189,098 146,811 (87,789) — 361,046 Amortization and depreciation 34,821 29,034 37,581 3,847 — 105,283 EBITDA 147,747 218,132 184,392 (83,942) — 466,329 Reconciliation: Finance costs (77,668) Finance income 45,395 Foreign exchange loss, net (5,249) Other expenses, net (36,281) Income tax expense (49,647) Profit for the period 237,596 Total assets 1,297,037 1,125,336 608,700 289,353 — 3,320,426 Capital expenditures 20,239 24,773 23,902 2,409 — 71,323 Liabilities 110,522 232,630 230,417 667,871 — 1,241,440 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 130 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) Key data by operating segment for the year ended 30 June 2024: The Group revenue by category for the year ended 30 June was as follows: For the year ended 30 June 2025 For the year ended 30 June 2024 Oilseed Processing Infrastructure and Trading Farming Total Oilseed Processing Infrastructure and Trading Farming Total Revenue from: - edible oils sold in bulk and meal 1,791,083 580,758 5,424 2,377,265 1,324,250 385,303 6,483 1,716,036 - agriculture commodities merchandising — 1,287,182 9,672 1,296,854 — 1,254,723 20,531 1,275,254 - freight and other services 111,369 153,789 — 265,158 208,785 196,704 — 405,489 - bottled sunflower oil 113,817 — 77 113,894 102,715 — 48 102,763 - electricity 31,661 — — 31,661 39,866 — — 39,866 - farming — — 30,210 30,210 — — 42,054 42,054 Total 2,047,930 2,021,729 45,383 4,115,042 1,675,616 1,836,730 69,116 3,581,462 Revenue is obtained principally from the sale of commodities, recognized once the control of the goods has been transferred from the Group to the customer. Revenue derived from freight, storage, and other services, presented in the line Revenue from edible oils sold in bulk, and meal, is recognized over time as the service is rendered. The transaction price allocated to outstanding performance obligations as of 30 June 2025 is USD 4,737 thousand (30 June 2024: USD 10,046 thousand). This amount represents revenue from carriage, freight, and insurance services under CIF/CFR Incoterms contracts which are to be executed in July 2025, when the goods are delivered to the point of destination and under which the Group has already recognized revenue from the sale of goods at a point in time as of 30 June 2025. Timing of revenue recognition allocated by the operating segment for the year ended 30 June under requirements of IFRS 15 was as follows: For the year ended 30 June 2025 For the year ended 30 June 2024 Oilseed Processing Infrastructure and Trading Farming Total Oilseed Processing Infrastructure and Trading Farming Total At a point in time 1,936,059 1,868,442 45,383 3,849,884 1,466,990 1,639,867 69,116 3,175,973 Over time 111,871 153,287 — 265,158 208,626 196,863 — 405,489 Total 2,047,930 2,021,729 45,383 4,115,042 1,675,616 1,836,730 69,116 3,581,462 During the year ended 30 June 2025, revenues of approximately USD 341,897 thousand (2024: USD 206,668 thousand) were derived from a single external customer. These revenues are attributed to Oilseeds processing and Infrastructure and Trading segments. Export sales accounted for 94.9% of total external sales during the year (2024: 93.5%). Oilseed Processing Infrastructure and Trading Farming Other Reconciliation Total Revenue (external) 1,675,616 1,836,730 69,116 — — 3,581,462 Intersegment sales 188,182 174,408 412,243 — (774,833) — Total revenue 1,863,798 2,011,138 481,359 — (774,833) 3,581,462 Net change in fair value of biological assets and agricultural produce — — (10,447) — — (10,447) Cost of sales (1,652,609) (1,678,238) (332,945) — 774,833 (2,888,959) Other operating income 50,461 11,227 6,090 8,815 — 76,593 Other operating expenses (19,038) (2,024) (83) (7,260) — (28,405) General and administrative expenses (18,154) (99,078) (20,370) (75,771) — (213,373) Net impairment losses on financial assets (2,492) (6,770) — (1,955) — (11,217) (Loss)/reversal of impairment losses on assets (172,324) (60,719) 8,362 (4,545) — (229,226) Profit/(loss) from operating activities 49,642 175,536 131,966 (80,716) — 276,428 Amortization and depreciation 33,734 28,255 38,836 3,898 104,723 EBITDA 83,376 203,791 170,802 (76,818) — 381,151 Reconciliation: Finance costs (119,079) Finance income 49,819 Foreign exchange gain, net 32,972 Other expenses, net (29,088) Income tax expense (43,424) Profit for the period 167,628 Total assets 1,324,217 1,297,675 685,423 89,596 — 3,396,911 Capital expenditures 45,349 88,095 24,811 2,881 — 161,136 Liabilities 86,828 200,274 193,454 1,050,061 — 1,530,617 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 131 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) For the year ended 30 June 2025, revenue from the Group’s five largest customers represented approximately 28.6% of total revenue (for the year ended 30 June 2024: 24.3%). The Group’s revenue from external customers (based on the country of incorporation of the sales counterparty) and information about its segment assets (non‑current assets excluding non-current financial assets and deferred tax assets) by geographical location are detailed below: Revenue from external customers Non-current assets For the year ended 30 June 2025 For the year ended 30 June 2024 As of 30 June 2025 As of 30 June 2024 Europe 2,157,006 1,641,656 Ukraine 1,243,233 1,166,255 of which Switzerland 547,229 517,401 Other locations 15,175 16,368 Asia 1,816,426 1,828,406 of which India 584,325 669,655 Other locations 141,610 111,400 Total 4,115,042 3,581,462 Total 1,258,408 1,182,623 None of the other locations represented more than 10% of total revenue or non-current assets individually. 8. Cash and Cash Equivalents The balances of cash and cash equivalents were as follows: As of 30 June 2025 As of 30 June 2024 Cash in banks in USD 449,176 634,531 Cash in banks in UAH 154,850 150,531 Cash in banks in other currencies 13,485 24,522 Total 617,511 809,584 Less bank overdrafts (Note 19) (3) (5) Cash for the purposes of cash flow statement 617,508 809,579 According to the international rating agency Fitch, the credit ratings of the banks where the Group held accounts as of 30 June were as follows: As of 30 June 2025 As of 30 June 2024 International bank with F1+ rating 219,833 182,512 International bank with F1 rating 220,861 227,899 International bank with F2 rating 6,816 10,026 Banks with lower than F2 rating 135,973 193,172 Banks without international ratings 34,028 195,975 Total 617,511 809,584 As of 30 June 2025, the balances held in Ukrainian subsidiaries of international banks without international ratings amounted to USD 9,601 thou- sand (30 June 2024: USD 195,974 thousand). The parent institutions of these subsidiaries were predominantly rated F2 or higher by Fitch or by other equivalent international rating agencies. As of 30 June 2025 and 30 June 2024, the Management monitors credit risk by assessing the financial position and external credit ratings of the parent institutions of these subsidiaries, in line with the Group’s treasury policy and IFRS 7 requirements on credit risk disclosure. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 132 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) The reconciliation in the table below presents changes in the Group’s liabilities arising from financing activities by incorporating cash flows and non-cash changes over the reporting period. Bank borrowings (Note 19) Lease liabilities (Note 21) Bonds Issued (Note 20) Total As of 30 June 2023 869,933 197,895 603,823 1,671,651 Repayments net of proceeds, including interest paid (597,031) (43,804) (39,750) (680,585) Non-cash movements Additions and change of terms of lease liabilities — 17,333 — 17,333 Termination of lease agreements — (7,270) — (7,270) Non-cash settlement of lease liabilities — (1,888) — (1,888) Amortization of one-off and transaction costs — — 1,369 1,369 Interest expense accrued (Note 27) 45,667 25,243 39,750 110,660 Interest expense capitalized 4,245 — — 4,245 Foreign exchange movements 1,007 (642) — 365 Translation difference — (17,127) — (17,127) Other changes (8,655) — — (8,655) As of 30 June 2024 315,166 169,740 605,192 1,090,098 Repayments net of proceeds, including interest paid (89,524) (48,313) (330,000) (467,837) Non-cash movements Additions and change of terms of lease liabilities — 74,472 — 74,472 Termination of lease agreements — (5,868) — (5,868) Non-cash settlement of lease liabilities — (1,567) — (1,567) Amortization of one-off and transaction cost — — 907 907 Interest expense accrued (Note 27) 28,587 21,196 26,006 75,789 Interest expense capitalized 395 — — 395 Foreign exchange movements (1,142) (251) — (1,393) Translation difference — (4,084) — (4,084) Other changes (49) (70) (2) (121) As of 30 June 2025 253,433 205,255 302,103 760,791 9. Trade Accounts Receivable The balances of trade accounts receivable were as follows: As of 30 June 2025 As of 30 June 2024 Trade accounts receivable 265,820 321,742 Allowance for expected credit losses (13,160) (16,496) Total 252,660 305,246 The average credit period on sales of goods is 25 days (2024: 33 days). The carrying value of trade accounts receivable approximates the fair value. As of 30 June 2025, a receivable balance of USD 242,306 thousand was due from international customers and the remaining USD 10,354 thousand was receivable from Ukrainian buyers (30 June 2024: USD 285,734 thousand and USD 19,512 thousand respectively). Expected credit losses on trade receivables are estimated using a provision matrix, based on the Group’s historical default experience and an assessment of the debtors’ current financial position. The estimates are further adjusted for debtor-specific factors, industry-wide economic condi- tions, and both current and forward-looking information available at the reporting date. The Group recognizes a full (100%) loss allowance for all receivables more than 90 days past due, as historical evidence indicates that such balances are generally not recoverable. The changes in expected credit loss provisions are recognized in the line Net reversal/(impairment) losses on financial assets. For the year ended 30 June 2025, a decrease in loss allowance was USD 2,262 thousand (for the period ended 30 June 2024: USD 5,706 thousand). Subsequent recoveries of amounts previously written off are credited against the same line item. The following table details the risk profile of trade accounts receivable as of 30 June based on the Group’s provision matrix: As of 30 June 2025 As of 30 June 2024 Days past due Days past due Not past due Less than 90 More than 90 Total Not past due Less than 90 More than 90 Total Expected loss rate 1 0.34% 0.71% 80.86% 0.27% 0.33% 98.97% Gross carrying amount 199,359 51,479 14,982 265,820 262,717 43,215 15,810 321,742 Loss allowance (680) (365) (12,115) (13,160) (708) (141) (15,647) (16,496) Total 198,679 51,114 2,867 252,660 262,009 43,074 163 305,246 1 Differences in expected loss rate are possible due to rounding Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 133 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) The movements in allowance for credit loss relating to trade accounts receivable as of 30 June are presented below: Trade accounts receivables Lifetime ECL Individually assessed Total Loss allowance as of 30 June 2023 9,859 4,055 13,914 Increase in loss allowance recognized in profit or loss during the year 3,442 2,264 5,706 Trade receivables written off during the year as uncollectible (388) — (388) Unused amount reversed — (2,736) (2,736) Loss allowance as of 30 June 2024 12,913 3,583 16,496 Decrease in loss allowance recognized in profit or loss during the year (2,092) (170) (2,262) Unused amount reversed — (1,074) (1,074) Loss allowance as of 30 June 2025 10,821 2,339 13,160 Trade receivables are written off when it is unlikely that they will be recovered, based on indicators such as a debtor's failure to make payments or other evidence demonstrating an inability to settle the outstanding amount. 10. Taxes Recoverable and Prepaid The balances of taxes recoverable and prepaid were as follows: As of 30 June 2025 As of 30 June 2024 Value-added tax recoverable and prepaid 125,686 113,900 Other taxes recoverable and prepaid 151 227 Total 125,837 114,127 Value-added tax (“VAT”) recoverable and prepaid primarily relates to VAT credits on purchases of agricultural products in the domestic market of Ukraine. Management expects that these balances will be fully recovered within 12 months after the reporting date either through the cash collection or offsetting against corresponding VAT liabilities. For the year ended 30 June 2025, the amount of VAT refunded by the government in cash was USD 257,360 thousand (30 June 2024: USD 272,150 thousand). 11. Inventory The balances of inventories were as follows: As of 30 June 2025 As of 30 June 2024 Finished products 186,698 71,209 Goods for resale 80,803 72,699 Raw materials 69,318 96,452 Fuel 5,644 8,331 Work in progress 2,362 2,179 Products of agriculture 2,248 15,377 Packaging materials 1,570 1,509 Other inventories 14,824 9,904 Total 363,467 277,660 As of 30 June 2025, inventories carrying amount to USD 143,930 thousand (as of 30 June 2024: nil) have been pledged as security for short-term borrowings (Note 19). 12. Biological Assets The balances of biological assets were as follows: As of 30 June 2025 As of 30 June 2024 Units Carrying amount Units Carrying amount Non-current assets Non-current cattle, heads 3,683 4,957 4,772 6,521 Total 4,957 6,521 Current assets Crops in fields, hectares 341,942 229,200 334,327 186,051 Current cattle, heads 3,360 1,469 4,580 1,661 Total 230,669 187,712 For the year ended 30 June 2025, the Group recognized a gain of USD 6,590 thousand due to changes in the fair value of biological assets (2024: loss of USD 10,447 thousand). For the year ended 30 June 2025, the Group incurred a revaluation loss of USD 47,736 thousand on agricultural products at the point of harvest (2024: loss of USD 51,838 thousand), and a revaluation gain of USD 56,808 thousand on crop-bearing fields (2024: gain of USD 41,872 thousand), and a revaluation loss of USD 2,482 thousand on livestock (2024: loss of USD 481 thousand). Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 134 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) The balances of crops in fields were as follows: As of 30 June 2025 As of 30 June 2024 Hectares Value Hectares Value Corn 171,875 124,774 86,486 42,020 Wheat 94,690 55,831 93,112 62,009 Sunflower 46,336 34,788 66,946 45,031 Soybean 23,836 10,713 72,286 28,466 Rapeseed 3,975 2,577 13,720 8,332 Other 1,230 517 1,777 193 Total 341,942 229,200 334,327 186,051 The following table represents the changes in the carrying amounts of crops in fields during the years ended 30 June 2025 and 2024: Capitalized expenditures Fair value movement Fair value of biological assets As of 30 June 2023 172,709 (26,470) 146,239 Expenditures capitalized in biological assets (harvest 2023) 100,871 — 100,871 Decrease due to harvest (harvest 2023) (273,580) 26,470 (247,110) Expenditures capitalized in biological assets (harvest 2024) 155,027 — 155,027 Gain arising from changes in fair value of biological assets (sowing under harvest 2024) — 44,916 44,916 Translation difference (10,848) (3,044) (13,892) As of 30 June 2024 144,179 41,872 186,051 Expenditures capitalized in biological assets (harvest 2024) 84,855 — 84,855 Decrease due to harvest (harvest 2024) (229,018) (41,872) (270,890) Expenditures capitalized in biological assets (harvest 2025) 172,131 — 172,131 Gain arising from changes in fair value of biological assets (sowing under harvest 2025) — 57,053 57,053 Translation difference 245 (245) — As of 30 June 2025 172,392 56,808 229,200 The fair value of agricultural produce at the date of harvest was estimated based on prices observed in active markets and is classified within Level 2 of the fair value hierarchy. Crops in fields and non-current livestock are measured using a discounted cash flow approach, considering region- specific prices and other relevant metrics for each asset group. These biological assets are classified within Level 3 of the fair value hierarchy. Current livestock is measured based on market prices of animals of similar age, breed, and genetic merit and is classified within Level 2 of the fair value hierarchy. Changes in livestock balances primarily reflect the transfer of young calves to the mature herd, along with variations in market prices and exchange rates between reporting dates. The table below presents the Group’s biological assets classified according to the fair value hierarchy: As of 30 June 2025 As of 30 June 2024 Level 2 Level 3 Total Level 2 Level 3 Total Livestock Mature – Milk cows — 4,957 4,957 — 6,521 6,521 Immature – Milk cows 822 — 822 988 — 988 Immature – Calves 647 — 647 673 — 673 Crops in fields — 229,200 229,200 — 186,051 186,051 Total 1,469 234,157 235,626 1,661 192,572 194,233 There have been no changes in the valuation techniques applied and any transfers between fair value hierarchy levels during the year. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 135 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) The following table shows the valuation techniques used in measuring, as well as unobservable inputs of the crops in field and milk cows. Sensitivity of the input to fair value increase/ (decrease) As of 30 June 2025 As of 30 June 2024 As of 30 June 2025 As of 30 June 2024 Descrip- tion Valuation techniques Unobservable Inputs Range of unobservable inputs Input 5% higher Input 5% lower Input 5% higher Input 5% lower Crops in fields Discounted cash flows Crops yield 2.24 – 8.41 tons per hec- tare 2.00 – 7.34 tons per hec- tare 19,306 (19,299) 15,093 (15,094) Crops prices 180 – 485 USD per ton 153 – 411 USD per ton 19,306 (19,299) 15,093 (15,094) Discount rate 24.80% (in UAH, short- term) 25.00% (in UAH, short- term) (628) 636 (400) 405 Milk cows Discounted cash flows Milk yield – liter per cow 17.84 – 22.25 liters per cow per day 18.42 – 22.18 liters per cow per day 166 (166) 235 (235) Milk price – per liter 18.37 - 18.47 UAH 14.71 - 14.95 UAH 1,148 (1,148) 1,210 (1,210) Weight of the cow – kg per cow 386 – 500 kg 392 – 517 kg 83 (83) 93 (93) Discount rate 24.80% (in UAH, short- term) 25.00% (in UAH, short- term) (90) 93 (118) 122 The Group’s agricultural crops are subject to risks arising from climate change, including prolonged droughts, heatwaves, irregular precipitation, and other extreme weather events, which may negatively impact both yields and crop quality. Such climatic factors contribute to fluctuations in the fair value of biological assets. To mitigate these risks, the Group has implemented adaptive measures, including soil fertility monitoring, precision farming technologies, and diversified crop rotation. Despite these efforts, climate variability continues to represent a significant source of uncertainty in forecasting yields and determining the fair value of biological assets. 13. Other Financial Assets The balances of other financial assets were as follows: As of 30 June 2025 As of 30 June 2024 Government bonds 144,402 185,310 Margin account with brokers 67,491 82,215 Loans granted 46,437 22,306 Derivative financial instruments 26,116 25,288 Short-term bank deposits 12,000 12,747 Pledge deposits — 1,303 Other financial assets 19,467 10,760 Total 315,913 339,929 The Group's exposure to credit risks associated with other financial assets is disclosed in Note 31. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 136 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) 14. Property, Plant and Equipment The following table represents movements in property, plant and equipment for the year ended 30 June 2025: Oilseed Processing Infrastructure and Trading Farming Other Total Net Book Value as of 30 June 2024 505,611 368,880 49,279 20,334 944,104 Land 172 3,497 23 1,048 4,740 Buildings and Constructions 289,500 159,524 11,079 16,405 476,508 Production machinery and equipment 185,096 67,067 1,032 523 253,718 Agricultural equipment and vehicles 7,813 111,255 33,757 1,272 154,097 Other fixed assets 2,955 1,511 2,624 1,071 8,161 CIP and uninstalled equipment 20,075 26,026 764 15 46,880 Additions in CIP and uninstalled equipment 20,007 22,509 22,784 3,475 68,775 Reclassification 724 50 113 (887) — Land 1 (240) 23 — (216) Buildings and Constructions 487 (2,087) 86 (425) (1,939) Production machinery and equipment (656) (233) (125) (2) (1,016) Agricultural equipment and vehicles (16) (33) (88) (28) (165) Other fixed assets 5 451 (41) (466) (51) CIP and uninstalled equipment 903 2,192 258 34 3,387 Additions from acquisition of subsidiaries — 3,419 2,866 8,981 15,266 Land — — — 144 144 Buildings and Constructions — 2,672 5 2,613 5,290 Production machinery and equipment — 13 2,016 1,190 3,219 Agricultural vehicles and equipment — 88 770 987 1,845 Other fixed assets — 44 75 2,114 2,233 CIP and uninstalled equipment — 602 — 1,933 2,535 Transfers — — — — — Land 27 110 — 166 303 Buildings and Constructions 5,669 4,081 1,546 1,483 12,779 Production machinery and equipment 17,598 4,578 624 — 22,800 Agricultural equipment and vehicles 1,234 4,572 18,874 807 25,487 Other fixed assets 1,120 1,444 1,811 642 5,017 CIP and uninstalled equipment (25,648) (14,785) (22,855) (3,098) (66,386) Revaluation 9,252 — — — 9,252 Buildings and Constructions (6,379) — — — (6,379) Production machinery and equipment 15,634 — — — 15,634 Other fixed assets (3) — — — (3) Disposals (at NBV) (622) (201) (382) (4,029) (5,234) Land (14) — — — (14) Buildings and Constructions (49) (37) (44) — (130) Production machinery and equipment (26) (14) (9) (870) (919) Agricultural equipment and vehicles (37) (18) (275) (963) (1,293) Other fixed assets (6) (3) (42) (2,107) (2,158) CIP and uninstalled equipment (490) (129) (12) (89) (720) Disposal of Subsidiaries (at NBV) — — — (6,602) (6,602) Transfers from right-of-use assets — — — (99) (99) Depreciation expense (34,129) (27,850) (14,369) (1,632) (77,980) Buildings and Constructions (14,097) (6,501) (1,234) (566) (22,398) Production machinery and equipment (17,453) (6,996) (716) (266) (25,431) Agricultural equipment and vehicles (1,575) (13,503) (11,282) (489) (26,849) Other fixed assets (1,004) (850) (1,137) (311) (3,302) Impairment and reversal of impairment of property, plant and equipment 5,473 (3,094) — — 2,379 Land — (100) — — (100) Buildings and Constructions (1,089) (2,518) — — (3,607) Production machinery and equipment 6,906 (345) — — 6,561 Agricultural equipment and vehicles (19) (8) — — (27) Other fixed assets (22) (65) — — (87) CIP and uninstalled equipment (303) (58) — — (361) Translation difference (146) (1,999) (1,340) (34) (3,519) Land — (26) (5) — (31) Buildings and Constructions (2) (1,386) (293) (29) (1,710) Production machinery and equipment — (407) (8) (1) (416) Agricultural equipment and vehicles (142) (23) (938) (3) (1,106) Other fixed assets (2) (20) (70) (1) (93) CIP and uninstalled equipment — (137) (26) — (163) Net Book Value as of 30 June 2025 506,170 361,714 58,951 19,507 946,342 Land 186 3,241 41 1,048 4,516 Buildings and Constructions 274,040 153,748 11,145 15,409 454,342 Production machinery and equipment 207,099 63,663 2,814 252 273,828 Agricultural equipment and vehicles 7,258 102,330 40,818 1,460 151,866 Other fixed assets 3,043 2,512 3,220 934 9,709 CIP and uninstalled equipment 14,544 36,220 913 404 52,081 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 137 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) The following table represents movements in property, plant and equipment for the year ended 30 June 2024: Oilseed Processing Infrastructure and Trading Farming Other Total Net Book Value as of 30 June 2023 616,627 340,999 41,559 21,226 1,020,411 Land 266 1,035 30 1,048 2,379 Buildings and Constructions 272,068 139,352 12,767 16,947 441,134 Production machinery and equipment 132,714 77,337 1,348 964 212,363 Agricultural equipment and vehicles 6,541 104,034 25,843 1,276 137,694 Other fixed assets 1,906 1,557 675 988 5,126 CIP and uninstalled equipment 203,132 17,684 896 3 221,715 Additions in CIP and uninstalled equipment 44,973 87,804 24,218 1,654 158,649 Reclassification (93) 87 8 (2) — Land — 1 (13) — (12) Buildings and Constructions 611 13 31 — 655 Production machinery and equipment (657) 77 — (4) (584) Agricultural equipment and vehicles (1) (2) (41) — (44) Other fixed assets (2) (2) (6) 2 (8) CIP and uninstalled equipment (44) — 37 — (7) Additions from acquisition of subsidiaries — 1,449 — — 1,449 Buildings and Constructions — 1,367 — — 1,367 Production machinery and equipment — 13 — — 13 Other fixed assets — 7 — — 7 CIP and uninstalled equipment — 62 — — 62 Transfers — — — — — Land — 2,809 14 — 2,823 Buildings and Constructions 78,699 40,396 904 66 120,065 Production machinery and equipment 132,856 5,656 106 1 138,619 Agricultural equipment and vehicles 3,430 28,792 21,350 469 54,041 Other fixed assets 2,087 727 1,843 374 5,031 CIP and uninstalled equipment (217,072) (78,380) (24,217) (910) (320,579) Disposals (at NBV) (1,091) (8,456) (423) (735) (10,705) Land (94) — (4) — (98) Buildings and Constructions (126) (114) (139) — (379) Production machinery and equipment (43) (158) (19) (3) (223) Agricultural equipment and vehicles (25) (7,980) (230) — (8,235) Other fixed assets (158) — (28) (5) (191) CIP and uninstalled equipment (645) (204) (3) (727) (1,579) Disposal of Subsidiaries (at NBV) — (280) — — (280) Buildings and Constructions — (215) — — (215) Production machinery and equipment — (63) — — (63) Agricultural equipment and vehicles — (1) — — (1) CIP and uninstalled equipment — (1) — — (1) Depreciation expense (33,047) (27,027) (12,173) (1,731) (73,978) Buildings and Constructions (13,639) (6,081) (1,258) (587) (21,565) Production machinery and equipment (17,028) (6,817) (291) (435) (24,571) Agricultural equipment and vehicles (1,508) (13,418) (10,125) (468) (25,519) Other fixed assets (872) (711) (499) (241) (2,323) Impairment and reversal of impairment of property, plant and equipment (121,075) (17,647) 746 — (137,976) Land — (252) — — (252) Buildings and Constructions (48,112) (9,480) — — (57,592) Production machinery and equipment (62,746) (7,369) — — (70,115) Agricultural equipment and vehicles — (84) — — (84) Other fixed assets — — 746 — 746 CIP and uninstalled equipment (10,217) (462) — — (10,679) Translation difference (683) (8,049) (4,656) (78) (13,466) Land — (97) (4) — (101) Buildings and Constructions (1) (5,714) (1,226) (21) (6,962) Production machinery and equipment — (1,609) (112) — (1,721) Agricultural equipment and vehicles (624) (86) (3,040) (5) (3,755) Other fixed assets (6) (67) (107) (47) (227) CIP and uninstalled equipment (52) (476) (167) (5) (700) Net Book Value as of 30 June 2024 505,611 368,880 49,279 20,334 944,104 Land 172 3,497 23 1,048 4,740 Buildings and Constructions 289,500 159,524 11,079 16,405 476,508 Production machinery and equipment 185,096 67,067 1,032 523 253,718 Agricultural equipment and vehicles 7,813 111,255 33,757 1,272 154,097 Other fixed assets 2,955 1,511 2,624 1,071 8,161 CIP and uninstalled equipment 20,075 26,026 764 15 46,880 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 138 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) The total cost of property, plant and equipment and total accumulated depreciation and impairment losses as of 30 June 2025 and 2024 were as follows: Cost as of 30 June 2025 1 Accumulated depreciation and impairment losses as of 30 June 2025 1 Cost as of 30 June 2024 Accumulated depreciation and impairment losses as of 30 June 2024 2 Land 4,516 — 4,740 — Buildings and constructions 551,822 (97,480) 552,529 (76,021) Production machinery and equipment 381,552 (107,724) 332,629 (78,911) Agricultural equipment and vehicles 328,169 (176,303) 312,513 (158,416) Other fixed assets 31,086 (21,377) 27,203 (19,042) CIP and uninstalled equipment 52,081 — 46,880 — Total 1,349,226 (402,884) 1,276,494 (332,390) Had the Group’s buildings and constructions and production machinery and equipment (Oilseed Processing segment) been measured on a histor- ical cost basis, their carrying amount would have been as follows: As of 30 June 2025 As of 30 June 2024 Buildings and constructions 263,082 233,892 Production machinery and equipment 231,933 173,948 Total 495,015 407,840 As a result of revaluation as of 30 June 2025 the Group recognized increments and decrements of USD 19,098 thousand and USD 8,189 thousand respectively in the Consolidated Statement of Other Comprehensive Income along with impairment losses reversed and impairment losses of USD 7,849 thousand and USD 6,941 thousand respectively in Consolidated Statement of Profit or Loss. During the financial year 2025 fixed assets of the Group estimated of USD 341 thousand were damaged due to military operations caused by shelling from the Russian missiles (2024: port infrastructure assets in the amount of USD 9,795 thousand and elevator blocks in the amount of USD 1,367 thousand). As of 30 June 2025, prepayments for property, plant and equipment were in the amount of USD 13,698 thousand (30 June 2024: USD 9,467 thousand). As of 30 June 2025, property, plant and equipment with a carrying amount of USD 274,849 thousand (30 June 2024: USD 437,930 thousand) were pledged by the Group as collateral against short-term and long-term bank borrowings (Note 19). In 2024 and 2025, in response to the ongoing military invasion of Ukraine, the Group reorganized its business processes to address current challenges and ensure governance continuity. As a result, the 2024 and 2025 evaluation of the recoverable amount of assets or cash-generating units was based on a single model. Risks and uncertainties caused by the war are incorporated into the discount rate calculation, while cash flow forecasts are free from those risks and uncertainties. The recoverable amount of each CGU in which impairment was identified was determined using discounted cash flow projections based on reliable estimates of future cash flows. Management estimated the budgeted gross margin with reference to expected market developments. The weighted average growth rates applied were consistent with forecasts published in industry reports. The discount rates used were pre-tax and reflected the specific risks associated with the relevant segments. Oilseed Processing segment The key assumptions applied in the value-in-use and income approach calculations, for the purpose of economic obsolescence test (Note 5), by the group of CGUs in the Oilseed Processing segment across all forecasted periods are as follows: Oilseed processing Processing volume, thousand ton Sales price of sunflower oil, USD per ton Purchase price of sun- flower seeds, USD per ton As of 30 June 2025 3,498 1,020-1,065 476 - 493 As of 30 June 2024 3,285 901 - 950 420 - 441 As of 30 June 2025, a discount rate of 16.9% was applied for both the five-year forecast and the terminal periods (30 June 2024: 18.5% for the five-year forecast period and 15.5% for the terminal period). As of 30 June 2025, the growth rate, used for extrapolating of the cash flows for periods over 5 years was set at the level of 2.19% (30 June 2024 – 2.21%). 1 Impairment losses related to Property, Plant and Equipment of Oilseed processing segment are included to the Cost as of 30 June 2025. Impairment losses related to Property, Plant and Equipment of other segments are included to the Accumulated depreciation. 2 During the year ended 30 June 2025, the Group made certain corrections and reclassifications, please see Note 4 for more details. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 139 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) As of 30 June 2025, the sensitivity analysis to the mentioned above key assumptions of the CGUs in the Oilseeds Processing segment are disclosed in the table below. CGU Inputs Change in input by: Change in value-in-use and income ap- proach calculations results: Poltavsky VOEP PJSC Sales price of sunflower oil, USD per ton Decrease by 3.00% USD 16,947 decrease Purchase price of sunflower seeds, USD per ton Increase by 3.00% USD 18,699 decrease Bandursky VOEP LLC Sales price of sunflower oil, USD per ton Decrease by 3.00% USD 40,984 decrease Purchase price of sunflower seeds, USD per ton Increase by 3.00% USD 43,071 decrease Discount rates Increase by 10.00% USD 11,406 decrease Processing volume, thousand tons Decrease by 15.00% USD 17,222 decrease BSI LLC Sales price of sunflower oil, USD per ton Decrease by 3.00% USD 39,142 decrease Purchase price of sunflower seeds, USD per ton Increase by 3.00% USD 41,460 decrease Discount rates Increase by 10.00% USD 8,745 decrease Processing volume, thousand tons Decrease by 15.00% USD 18,766 decrease Kropyvnytskyi Sales price of sunflower oil, USD per ton Decrease by 3.00% USD 14,310 decrease OEP PJSC Purchase price of sunflower seeds, USD per ton Increase by 3.00% USD 15,935 decrease Prydniprovskyi Sales price of sunflower oil, USD per ton Decrease by 3.00% USD 55,423 decrease OEZ LLC Purchase price of sunflower seeds, USD per ton Increase by 3.00% USD 58,351 decrease Discount rates Increase by 10.00% USD 15,352 decrease Processing volume, thousand tons Decrease by 15.00% USD 20,494 decrease Starokostiantynivskyi Sales price of sunflower oil, USD per ton Decrease by 3.00% USD 38,599 decrease OEZ LLC Purchase price of sunflower seeds, USD per ton Increase by 3.00% USD 41,421 decrease Discount rates Increase by 10.00% USD 5,285 decrease Processing volume, thousand tons Decrease by 15.00% USD 10,261 decrease As of 30 June 2025, the sensitivity analysis did not identify the recoverable amount as being sensitive to the reasonably possible changes of assumptions other than disclosed above. Farming segment As of 30 June 2025, the market selling prices of agricultural commodities have been taken into consideration while determining the assumptions for Farming CGU. The key assumptions applied in the value-in-use approach calculations by segment are as follows: Farming Crop yields, tons per hectare Sales price of crops, USD per ton Transportation cost, USD per ton As of 30 June 2025 2.7 – 9.6 215 - 494 10 - 22 As of 30 June 2024 2 - 13.3 194 - 472 8 - 29 As of 30 June 2025, a discount rate of 24.8% was applied for both the five-year forecast and the terminal period (30 June 2024: 25.0 % for the five- year forecast period and 17.0% for the terminal period). As of 30 June 2025, the growth rate, used for extrapolating of the cash flows for periods over 5 years was set at the level of 4.53% (30 June 2024 – 4.03%). As of 30 June 2025, the sensitivity analysis indicated that the recoverable amount of the Farming CGU is not sensitive to any reasonably possible changes in any assumptions. Infrastructure and Trading segment As of 30 June 2025 and 2024, the Infrastructure and Trading segment’s CGUs assumptions rely on transshipment rates and suggested proceeds volumes. The key assumptions applied in the value-in-use and income approach calculations by the Group of CGUs in the Infrastructure and Trading segment are as follows: Infrastructure and Trading Transshipment rate, USD per ton Transshipment volume, thousand ton As of 30 June 2025 8 - 10 9,190 – 10,000 As of 30 June 2024 11 - 14 6,800 As of 30 June 2025, a discount rate of 16.9% was applied for both the five-year forecast period and the terminal period (30 June 2024: 18.5% for the five-year forecast period and 15.5% for the terminal period). As of 30 June 2025, the growth rate, used for extrapolating of the cash flows for periods over 5 years was set at the level of 2.19% (30 June 2024: 2.21%). As of 30 June 2025, the sensitivity analysis indicated that the recoverable amount of the Infrastructure and Trading segments is not sensitive to reasonably possible changes in any assumptions. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 140 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) 15. Right-of-Use Assets The following table represents movements in right-of-use assets for the year ended 30 June 2025: Land Agricultural equip- ment and vehicles Buildings Total Cost as of 30 June 2024 240,429 5,483 7,892 253,804 Additions 111,639 2,325 871 114,835 Acquisition of subsidiaries 1,810 — — 1,810 Disposals (23,947) (4,893) (180) (29,020) Reclassification — 1,212 — 1,212 Translation difference (5,626) (106) (28) (5,760) Cost as of 30 June 2025 324,305 4,021 8,555 336,881 Accumulated depreciation and impairment as of 30 June 2024 (73,464) (5,172) (2,237) (80,873) Depreciation (26,961) (778) (752) (28,491) Disposals 14,083 4,109 (202) 17,990 Impairment loss on right-of-use assets (90) — — (90) Reclassification — (1,212) — (1,212) Translation difference 1,119 (36) 323 1,406 Accumulated depreciation and impairment as of 30 June 2025 (85,313) (3,089) (2,868) (91,270) Net book value as of 30 June 2025 238,992 932 5,687 245,611 The following table represents movements in right-of-use assets for the year ended 30 June 2024: Land Agricultural equip- ment and vehicles Buildings Total Cost as of 30 June 2023 263,789 7,521 7,514 278,824 Additions 17,248 — 531 17,779 Disposals (16,848) (800) (98) (17,746) Translation difference (23,760) (1,238) (55) (25,053) Cost as of 30 June 2024 240,429 5,483 7,892 253,804 Accumulated depreciation and impairment as of 30 June 2023 (66,033) (5,393) (1,754) (73,180) Depreciation (23,075) (1,367) (522) (24,964) Disposals 9,790 252 (25) 10,017 Impairment loss on right-of-use assets (72) (72) Translation difference 5,926 1,336 64 7,326 Accumulated depreciation and impairment as of 30 June 2024 (73,464) (5,172) (2,237) (80,873) Net book value as of 30 June 2024 166,965 311 5,655 172,931 The impairment testing of right-of-use assets, along with the property, plant, and equipment of the Farming segment (Note 14), was conducted by internal specialists. The recoverable amount of the assets was determined using the value-in-use method, which is based on estimated future cash flows discounted to their present value using an appropriate discount rate. The cash flow forecasts applied in the value-in-use approach were derived from financial budgets approved by management, covering five years, and were extrapolated using estimated growth rates for periods beyond five years. The calculation of the discount rate is based on assumptions specific to the Group and the operating segments to which they apply. 16. Intangible Assets The following table represents movements in intangible assets for the year ended 30 June 2025: Trademarks Land lease rights Other intangible assets Total Cost as of 30 June 2024 22,036 73,503 50,605 146,144 Additions — 12 3,288 3,300 Disposals — — (975) (975) Disposal of subsidiaries — — (23,329) (23,329) Translation difference — (2,721) (6,158) (8,879) Cost as of 30 June 2025 22,036 70,794 23,431 116,261 Accumulated amortization and impairment losses as of 30 June 2024 (8,851) (64,489) (36,410) (109,750) Amortization charge — (683) (2,379) (3,062) Disposals — — 28 28 Disposal of subsidiaries — — 23,300 23,300 Impairment of intangible assets — — (676) (676) Translation difference — 2,570 6,117 8,687 Accumulated amortization and impairment losses as of 30 June 2025 (8,851) (62,602) (10,020) (81,473) Net book value as of 30 June 2025 13,185 8,192 13,411 34,788 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 141 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) The following table represents movements in intangible assets for the year ended 30 June 2024: Trademarks Land lease rights Other intangible assets Total Cost as of 30 June 2023 22,036 80,771 24,812 127,619 Additions — — 2,487 2,487 Additions from the acquisition of subsidiaries — — 23,692 23,692 Disposals — — (185) (185) Translation difference — (7,268) (201) (7,469) Cost as of 30 June 2024 22,036 73,503 50,605 146,144 Accumulated amortization and impairment losses as of 30 June 2023 (8,851) (76,817) (5,617) (91,285) Amortization charge — (222) (1,958) (2,180) Disposals — — 187 187 Reversal of impairment of intangible assets — 5,281 (29,138) (23,857) Translation difference — 7,269 116 7,385 Accumulated amortization and impairment losses as of 30 June 2024 (8,851) (64,489) (36,410) (109,750) Net book value as of 30 June 2024 13,185 9,014 14,195 36,394 As of 30 June 2025, the Group’s subsidiaries held the following trademarks: “Schedry Dar”, “Stozhar”, “Zolota” and “Domashnya” with net book values of USD 4,567 thousand, USD 5,459 thousand, USD 2,980 thousand, and USD 179 thousand, respectively, in 2025 and 2024. These trademarks are used by the Group for the sale of bottled sunflower oil mostly in the Ukrainian market. The Group has determined that its trademarks have indefinite useful life. Accordingly, they are not amortized but are tested for impairment annually on 30 June, and whenever indicators of impairment arise, by comparing their recoverable amount with their carrying amount. As of 30 June 2025 and 2024, no impairment loss was recognized in respect of trademarks. The recoverable amount was determined using the fair value less costs of disposal method, applying the royalty relief approach, and is classified within Level 3 of the fair value hierarchy. The valuation is based on cash flow projections derived from management-approved financial budgets covering a five-year period. The total carrying amount of the trademarks has been allocated to the respective CGU in Oilseed Processing segment. The impairment testing of the value of intangible assets including trademarks, as of 30 June 2025 and 2024 was based on the same assumptions as the impairment test for property, plant and equipment (Note 26). As a result of impairment testing performed as of 30 June 2025 impairment losses were recognized in the amount of USD 676 thousand. 17. Advances from Customers and Other Current Liabilities The balance of advances from customers and other current liabilities were as follows: As of 30 June 2025 As of 30 June 2024 Accrued payroll, payroll-related taxes, and bonuses 172,378 118,747 Liabilities under commission agreements 34,532 18,177 Provisions for legal claims 16,502 16,502 Taxes payable and provision for tax liabilities 11,479 6,938 Provision for unused vacations and other provisions 10,615 9,161 Contract liabilities 7,484 18,598 Other current liabilities 4,295 4,274 Total 257,285 192,397 18. Other Financial Liabilities The balances of other financial liabilities were as follows: As of 30 June 2025 As of 30 June 2024 Share-based options (Note 29) 29,940 66,241 Derivative financial instruments 11,547 10,446 Accounts payable for property, plant and equipment 5,650 5,896 Other current liabilities 5,657 3,413 Total 52,794 85,996 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 142 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) 19. Borrowings The balance of borrowings was as follows: As of 30 June 2025 As of 30 June 2024 Current liabilities Bank credit lines 146,745 147,529 Current portion of long-term borrowings 22,239 — Interest accrued on short-term borrowings 1,348 3,653 Interest accrued on long-term borrowings 791 — Bank overdrafts (Note 8) 3 5 Short-term borrowings — 163,979 Total 171,126 315,166 Non-current liabilities Long-term bank borrowings 82,307 — Total 82,307 — The balance of bank credit lines in details by tranches were as follows: Interest rate Currency Amount due 30 June 2025 Amount due 30 June 2024 Ukrainian subsidiary of European bank 12.95% UAH 57,720 — Ukrainian subsidiary of European bank 13.00% UAH 36,022 — European bank 2.10% plus COF 1 USD 28,006 17,108 Ukrainian subsidiary of European bank from 5.30% to 6.50% USD 15,000 23,000 Ukrainian bank 4.95% USD 10,000 — Ukrainian subsidiary of European bank 7.75% USD — 35,000 Ukrainian bank 4.35% plus UIRD 2 UAH — 23,348 Ukrainian bank 7.25% USD — 22,000 European bank 2.50% plus COF USD — 12,578 Ukrainian bank 7.00% USD — 10,000 Ukrainian subsidiary of European bank 6.75% USD — 4,500 Total 146,748 147,534 As of 30 June 2025, the Group reclassified its bank borrowings with an initial long-term contractual maturity in the amount of USD 82,307 thousand from current to non-current liabilities. This classification reflects the fact that, as of the reporting date, the Group obtained a waiver from one of its long-term lenders in respect of certain covenant requirements, which remains valid for a period exceeding 12 months from the reporting date. The presentation as non-current liabilities are based on the updated waiver terms and the Group’s ongoing compliance with the amended covenant requirements. The balance of borrowings as of 30 June 2025 and 2024 is disclosed in the table below: Contractual maturity Interest rate in range Currency Amount due 30 June 2025 Amount due 30 June 2024 European bank 2030 from 3.03% to 3.10% plus SOFR USD 49,793 71,137 European bank 2029 from 3.03% to 3.10% plus SOFR USD 39,753 65,962 Ukrainian bank 2030 4.90% plus UIRD USD 15,000 — European bank 2027 4.50% plus SOFR USD — 23,040 European bank 2027 1% USD — 3,840 Total 104,546 163,979 3 The Group’s borrowings are subject to financial and non-financial covenants as specified in the respective loan agreements. These covenants are consistent with industry-standard practices for similar types of financial instruments. As of 30 June 2025, borrowings are classified as non-current liabilities in the amount of USD 82,307 thousand (30 June 2024: presented as current liabilities in the amount of USD 130,594 thousand). These borrowings are subject to financial and non-financial covenants as specified in the respective loan agreements. The covenants are consistent with industry-standard practices for similar financial instruments and are monitored on a quarterly, semi-annual, or annual basis, depending on the terms of the loan agreement. Certain non-financial covenants are monitored on a continuous basis throughout the reporting period. A breach of these covenants provides lenders with the right to demand early repayment of the respective liabilities. The principal financial covenants for key bank loans include Interest Cover Ratio, Net Leverage Ratio, Adjusted Net Leverage Ratio, and Gearing 1 The Group’s cost of funding (COF) reflects the weighted average interest rate on its outstanding borrowings. It is used as a reference input in determining discount rates applied in fair value measurements and value-in-use calculations. 2 Ukrainian Index of Retail Deposit Rates (UIRD) – is the average retail deposit rate in Ukraine published by the National Bank of Ukraine, used as a reference for UAH-denominated discount rates. 3 As of 30 June 2024, the Group classified its bank borrowings with long-term initial contractual maturity in the amount of USD 130,594 thousand as short-term. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 143 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) Ratio. Bank loans are also subject to certain restrictions on specific transactions, such as dividend distributions, guarantees for third-party obliga- tions, investments, or transactions with joint ventures. Also, non-financial covenants include the occurrence of a material adverse event and require the regular submission of certain reports and other information to creditors. Standard events of default under these agreements, subject to applicable grace periods and thresholds, include non-payment, cross-default, insol- vency, and winding-up of the Group or certain subsidiaries, including guarantors under bonds issued. The loan agreements also contain cross-default provisions, whereby the Group’s default on other loan agreements or bonds issued may result in lender’s right to request an early repayment of loan liabilities. As of the reporting date, the Group’s management has not identified any breaches of obligations that could trigger cross-default events and does not expect such events to occur within 12 months after the reporting date. The Group has assessed all relevant facts and circumstances and considers the risk of covenant non-compliance to be remote. This assessment considers the Group’s current financial position, historical performance, and established processes for proactively managing key financial metrics. The Group continuously monitors these metrics to ensure compliance with all covenant requirements. As of 30 June 2025, the undrawn amount of bank borrowings amounted to USD 312,701 thousand including available facility amounts upon bank credit lines and long-term financing (30 June 2024: USD 205,731 thousand). Short-term borrowings from banks were secured as follows: As of 30 June 2025 As of 30 June 2024 Inventory (Note 11) 143,930 — Property, plant and equipment (Note 14) 81,927 437,930 Future sales receipts 11,127 — Total 236,984 437,930 Long-term bank borrowings from banks were secured as follows: As of 30 June 2025 As of 30 June 2024 Assets pledged Property, plant and equipment (Note 14) 192,922 — Total 192,922 — 20. Bonds issued The balances of bonds issued were as follows: Maturity As of 30 June 2025 As of 30 June 2024 US 300,000 thousand 6.75% coupon bonds (issued October 2020) October 2027 298,487 298,087 US 300,000 thousand 6.50% coupon bonds (issued October 2019) October 2024 — 299,493 Total 298,487 597,580 As of 30 June 2025, the Group’s bonds were rated CCC by both S&P and Fitch (30 June 2024: CC), consistent with the Ukrainian sovereign rating. All the notes are unsecured, ranking equally with all existing and future senior unsecured indebtedness of the Company, and have been uncondi- tionally and irrevocably guaranteed by designated Group subsidiaries on the joint and several basis to the maximum extent permitted by law. As of 30 June 2025, the carrying amount of bonds classified as non-current liability in the amount of USD 298,487 thousand (30 June 2024: presented as current liabilities in amount of USD 597,580 thousand) was subject to financial and non-financial covenants as specified in the respective bond prospectus. Financial covenants are monitored on an annual basis, while non-financial covenants are monitored continuously during the reporting period. The breach of these covenants gives the bondholders the right to demand early repayment of the respective liabilities. The bond prospectus includes financial covenants, which are mainly based on the ratios of such financial indicators as fixed charges cover ratio fixed expenses, level of liabilities and level of total assets and EBITDA of certain subsidiaries of the Group. Bonds are also subject to agreed and impose restrictions on certain transactions, such as the incurrence of additional indebtedness, restricted payments (including dividends, loans, capital contributions, investments), asset disposals, mergers, and other investments. Also, non-financial covenants require the regular submission of certain reports and other information to the trustee. Standard events of default, typical for this type of instrument, include subject to applicable grace periods and carve-outs, non-payment, cross- default, insolvency, and judgment defaults affecting the Group or certain subsidiaries, including any guarantors under the bonds. Bond prospectus also contains cross-acceleration provisions, whereby the Group’s default on other loan agreements or bonds issued may result in acceleration of the bondholder’s right to request an early repayment of bonds. As of the reporting date, the Group’s management has not identified any breaches of obligations that could trigger cross-acceleration events and does not expect such events to occur within 12 months after the reporting date. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 144 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) The Group has assessed all relevant facts and circumstances and considers the risk of covenant non-compliance to be remote. This assessment reflects the Group’s current financial position, historical performance, and established processes for monitoring and managing key financial metrics. These metrics are continuously reviewed to ensure compliance with all covenant obligations. As of 30 June 2024, the Group did not have an unconditional right to defer settlement of its bonds for 12 months or longer as of this date the effective bank waivers related to its loans covered less than 12 months. Consequently, the Group therefore classified its long-term bonds as short- term. As of 30 June 2025, the Group obtained a waiver from one of its lenders in respect of certain non-financial covenants under a loan agreement. This waiver, effective for 12 months after the reporting date, removed the risk that a potential covenant breach could trigger an early repayment requirement affecting the Group’s bonds. Accordingly, in line with the requirements of IAS 1 Presentation of Financial Statements, the bonds have been classified as non-current liabilities in these financial statements (Note 19). Interest on the coupon bonds is payable semi-annually in arrears in April and October. As of 30 June 2025, accrued interest on the bonds amounted USD 3,616 thousand (30 June 2024: USD 7,612 thousand). 21. Lease liabilities The following is the maturity analysis of lease payments under the lease agreements as of 30 June: Maturity As of 30 June 2025 As of 30 June 2024 Payable within one year 35,191 29,811 Payable in the second to fifth years 174,591 147,871 Payable after five years 270,124 215,448 Total 479,906 393,130 less Future finance charges (274,651) (223,390) Present value of lease obligations 205,255 169,740 less Current portion (34,021) (27,206) Lease obligations, long-term portion 171,234 142,534 22. Income Tax The Group operates globally and is subject to the tax laws and regulations of multiple jurisdictions and authorities, as well as to tax treaties between those jurisdictions. The Group’s principal operations are located in Ukraine and Switzerland, where the corporate income tax rates were 18% and 15%, respectively, as of 30 June 2025 and 2024. A significant portion of the Group’s subsidiaries engaged in agricultural production pay the Fixed Agricultural Tax (FAT) in accordance with the Tax Code of Ukraine. The UAT is assessed by local authorities and is determined based on the area and valuation of the land used. The components of income tax expenses were as follows: For the year ended 30 June 2025 For the year ended 30 June 2024 Current income tax charge (50,107) (56,502) Withholding tax (18,380) — Deferred tax benefit relating to the origination and reversal of temporary differences 18,840 13,078 Total income tax expenses recognized in the reporting period (49,647) (43,424) The income tax expenses are reconciled to the profit before income tax per the Consolidated Statement of Profit or Loss as follows: As of 30 June 2025 As of 30 June 2024 Profit before income tax 287,243 211,052 Tax expenses at the Ukrainian statutory tax rate of 18% (51,704) (37,989) Income generated by payers that is exempt from taxation (FAT) 10,401 27,197 Tax effect of unused tax losses and tax offsets not recognized as deferred tax assets 5,260 2,356 Previously unrecognized tax losses used to reduce deferred tax expenses 13,990 — Withholding tax (18,380) — Non-deductible expenses in taxable profit, net (9,214) (34,988) Income tax expenses (49,647) (43,424) For the year ended 30 June 2025, the deferred tax recognized in other comprehensive income was USD 1,664 thousand (for the year ended 30 June 2024: loss of USD 1,784 thousand). Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 145 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) The main components of the deferred tax assets and deferred tax liabilities were as follows: As of 30 June 2025 As of 30 June 2024 Tax losses carried forward 17,207 20,304 Valuation of property, plant, and equipment 27,377 11,913 Valuation of inventories 5,116 2,367 Others 8,351 8,495 Deferred tax assets 58,051 43,079 Valuation of property, plant, and equipment (25,814) (26,019) Valuation of intangible assets 568 (1,209) Others (301) (260) Deferred tax liabilities (25,547) (27,488) Net deferred tax assets 32,504 15,591 As of 30 June 2025, deferred tax assets in the amount of USD 30,674 thousand are expected to be recovered or settled within twelve months after the reporting period (30 June 2024: USD 31,166 thousand). As of 30 June 2025, based upon projections for future taxable income over the periods in which the taxable temporary differences are anticipated to reverse, management believes it is probable that the Group will realize the benefits of deferred tax assets of USD 17,207 thousand (30 June 2024: USD 20,304 thousand) recognized concerning tax losses carried forward by the subsidiaries. The amount of future taxable income required to be generated by the Subsidiaries to utilize the tax benefits associated with the tax loss carried forward is approximately USD 95,594 thousand (30 June 2024: USD 112,800 thousand). However, the amount of the deferred tax asset considered realizable could be adjusted in the future if estimates of taxable income are revised. The Group does not recognize a deferred tax liability for all taxable temporary differences associated with investments in subsidiaries as it can control the timing of the reversal of such temporary differences and it is probable that they will not reverse in the foreseeable future. Certain deferred tax assets and liabilities have been offset following the Group’s accounting policy. The following is an analysis of the deferred tax balances (after offset) as they are presented in the Consolidated Statement of Financial Position: As of 30 June 2025 As of 30 June 2024 Deferred tax assets 51,698 35,626 Deferred tax liabilities (19,194) (20,035) Net deferred tax assets 32,504 15,591 23. Cost of Sales The cost of sales was as follows: For the year ended 30 June 2025 For the year ended 30 June 2024 Cost of goods for resale and raw materials used 3,001,654 2,069,486 Shipping and handling costs 360,336 639,819 Amortization and depreciation 100,229 98,863 Payroll and payroll-related costs 90,954 80,791 Total 3,553,173 2,888,959 For the year ended 30 June 2025 result on operations with commodity futures, options and unrealized forwards, included within the Cost of goods for resale and raw materials used line, decreased Cost of sales in the amount of USD 198,989 thousand (30 June 2024: USD 137,656 thousand decrease). Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 146 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) 24. Other Operating Income and Expenses Other operating income and expenses were as follows: For the year ended 30 June 2025 For the year ended 30 June 2024 Other operating income Gain on operations with securities 26,408 9,120 Contracts wash-out (price difference settlement) 15,193 5,142 Stock-take surplus 10,392 8,428 Other dispatch fees and fines 5,383 — Insurance reimbursement 3,319 33,539 Gain on sale of foreign currency 2,015 7,796 Gain on operations with swap contracts — 5,522 Other operating income 5,098 7,046 Total 67,808 76,593 Other operating expenses Loss on operations with other derivatives (25,448) (10,987) Loss on operations with swap contracts (20,966) — Other dispatch fees and fines — (17,418) Total (46,414) (28,405) The Group enters wash-out contracts to reduce administrative time and costs. These contracts can be offset based on a mutual agreement with the same partners who sold or purchased commodities. 25. General and administrative expenses General and administrative expenses were as follows: For the year ended 30 June 2025 For the year ended 30 June 2024 Payroll and payroll related costs 189,682 176,151 Audit, legal and other professional fees 14,207 10,317 Repairs and material costs 8,134 6,120 Other expenses 23,245 20,785 Total 235,268 213,373 Audit, legal and other professional fees for the year ended 30 June 2025 included the auditor’s remuneration in the amount of USD 763 thousand and remuneration for non-audit services was USD 55 thousand (for the year ended 30 June 2024: USD 778 thousand and USD 26 thousand, respectively). No consultancy services were provided by the auditors for the years ended 30 June 2025 and 2024. During the year ended 30 June 2025, the Group recognized expenses of USD 31,309 thousand in respect of profit-sharing arrangements (30 June 2024: bonus expenses USD 25,159 thousand). These amounts were included within payroll and payroll-related costs. The liability was recognized in accordance with the terms of the profit-sharing arrangement in the amount USD 49,268 thousand and was measured by reference to the esti- mated portion of profits. 26. Reversal of impairment losses/(impairment) of Assets Reversal of impairment losses/(impairment) of assets were as follows: For the year ended 30 June 2025 For the year ended 30 June 2024 Reversal of impairment/(impairment) of prepayments to suppliers and other current assets 6,958 (25,596) Reversal of impairment/(impairment) of property, plant and equipment (Note 14) 2,379 (117,115) Reversal of impairment losses on VAT recoverable 350 5,538 Reversal of impairment of inventories 3 4,136 Impairment of goodwill — (58,436) Write-offs of property, plant and equipment — (11,162) Impairment of right-of-use assets and write-offs of inventories (122) (2,863) Impairment of intangible assets (Note 16) (622) (23,728) Total 8,946 (229,226) Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 147 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) 27. Finance Costs and Income Finance costs and income were as follows: For the year ended 30 June 2025 For the year ended 30 June 2024 Finance costs expensed Interest expenses on bank loans (Note 8) (28,587) (45,667) Interest expenses on corporate bonds (Note 8) (26,006) (39,750) Interest expenses on lease liabilities (Note 8) (21,196) (25,243) Other finance costs (1,879) (8,419) Total (77,668) (119,079) Finance income Interest income received on financial assets held for cash management 39,483 42,553 Gain on modification of loan terms — 6,436 Other financial income 5,912 830 Total 45,395 49,819 Net finance costs (32,273) (69,260) 28. Other Expenses, net Other expenses, net was as follows: For the year ended 30 June 2025 For the year ended 30 June 2024 Social spending (30,434) (25,129) (Loss)/gain on disposal of Subsidiaries (5,232) 2,448 Fines and penalties (221) (5,746) Other expenses (394) (661) Total (36,281) (29,088) 29. Transactions with Related Parties As of 30 June 2025 and 2024, the Group is controlled by the Namsen Ltd (Note 2). The Group had the following balances outstanding with related parties from sales or purchases of goods and services: Related party Statement of Financial Position line Related party balances as of 30 June 2025 Related party balances as of 30 June 2024 Entities under Common control Trade accounts receivable 5,705 23,303 Prepayments to suppliers 27,270 47,112 Other financial assets 23,618 2,327 Non-current financial assets — 12,961 Trade accounts payable 10,360 1,968 Advances from customers and other current liabilities 34,606 18,177 Key management Other financial assets 2,913 4,997 Non-current financial assets 980 1,430 Advances from customers and other current liabilities 21,442 24,395 Other financial liabilities 31,961 66,279 Entities under Key Management control Non-current financial assets 1,875 1,984 Other related parties Prepayments to suppliers — 944 Other financial assets 5 12,086 Non-current financial assets — 2,032 The long-term management incentive plan which was signed in 2022 has exercise period commencing on 1 November 2024 and expiring on 31 December 2026. The Company granted management the option to sell to the Company 2,606,445 of its ordinary shares. The consideration for each share is USD 23.80. As of 30 June 2025, the fair value of the liability recognized in respect of share options amounted to USD 29,940 thousand (30 June 2024: USD 66,241 thousand). Part of this obligation was settled through set-off against advances to the same management, and the remaining balance was presented within Other financial liabilities. Transactions with related parties are conducted on terms equivalent to those prevailing in arm’s length transactions. Outstanding balances are unsecured and will be settled in cash. No guarantees have been provided or received in respect of related party receivables or payables. Loans are provided at interest rates comparable to the average commercial rate. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 148 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) Transactions with related parties were as follows: Related party Statement of Profit and Loss line Related party transac- tion for the year ended 30 June 2025 Related party transac- tion for the year ended 30 June 2024 Entities under common control Revenue 47,785 50,889 Purchases of various goods and services (54,380) (228,982) Cost of sales (11,842) (17,184) Other expenses (1,030) (732) Other operating income 3,600 — Other operating expenses — (2,839) Reversal of impairment losses/(impairment) of assets 2,668 (7,595) Loss on impairment of assets 1,043 — Key management General and administrative expenses (18,828) (50,529) Financial costs — (1,638) Finance income 1,643 — Entities under Key Man- agement control Financial costs — (3,100) Finance income 1,963 — Other related parties Revenue 982 20,883 Purchases of various goods and services (6,640) (3,333) Finance income 971 1,621 Net impairment losses on financial assets (20) (994) Remeasurement of liability related to options provided to key management as of 30 June 2025 resulted in gain recognized in General, administrative expenses in the amount of USD 6,617 thousand (30 June 2024: a loss of USD 11,963 thousand). The Group's key management personnel are the members of the Board of Directors and the management team. The remuneration of Directors and other members of key management personnel recognized in the Consolidated Statement of Profit and Loss including salaries and other current employee benefits amounted to USD 24,324 thousand (for the year ended 30 June 2024: USD 27,554 thousand). 30. Commitments and Contingencies Retirement and Other Benefit Obligations Employees of the Group receive pension benefits from the government under the laws and regulations of Ukraine. The Group’s contributions to the State Pension Fund for the year ended 30 June 2025 were USD 19,339 thousand (2024: USD 20,976 thousand). As of 30 June 2025, and 2024, the Group was not liable for any significant supplementary pensions, post-retirement health care, insurance benefits, or retirement indemnities to its current or former employees. Capital Commitments As of 30 June 2025, the Group had commitments under contracts with a group of suppliers for a total amount of USD 15,781 thousand, mostly for reconstruction of the grain transshipment complex and for modernization of the oil-crushing plant (30 June 2024: USD 17,833 thousand, mostly for the construction of port infrastructure and an oilseed crushing plant). Contractual Commitments on Sales As of 30 June 2025, the Group had outstanding commercial contracts for the export of 1,348,000 tons of grain, 270,000 tons of vegetable oil, and 98,198 tons of sunflower meal and other related products, with contract values of USD 300,879 thousand, USD 290,550 thousand and USD 28,521 thousand, respectively, in contract prices as of the reporting date. As of 30 June 2024, the Group had outstanding commercial contracts for the export of 672,500 tons of grain, 186,243 tons of sunflower oil, and 40,440 tons of sunflower meal and other related products, with contract values of USD 166,595 thousand, USD 184,097 thousand and USD 10,924 thousand, respectively, in contract prices as of the reporting date. Taxation and Legal Issues The international tax environment is becoming more complex in terms of tax administration, which could increase tax pressure on taxpayers. In particular, a key part of the OECD/G20 BEPS Project is addressing the tax challenges arising from the digitalization of the economy. The Global Anti-Base Erosion Rules (“GloBE”) are a key component of this plan and ensure large multinational enterprises pay a minimum level of tax on the income arising in each of the jurisdictions where they operate. More specifically, the GloBE Rules provide for a coordinated system of taxation that imposes a top-up tax on profits arising in a jurisdiction whenever the effective tax rate, determined on a jurisdictional basis, is below the minimum rate. Kernel Holding S.A. belongs to the Kernel Group, which is within the scope of the OECD Pillar Two Model Rules. Pillar Two legislation was enacted in Luxembourg, the jurisdiction in which Kernel Holding S.A. is incorporated, which has come into effect for fiscal years starting on or after 31 December 2023. However, it was determined in terms of Pillar 2 rules that Namsen Ltd residing in Cyprus should be considered as the Ultimate Parent Entity of the Kernel Group and should therefore have the obligation to apply the Income Inclusion Rule (“IIR”) and be charged with the top- up tax (“TUT”) due on any low-taxed profits of itself and its low-taxed subsidiaries. On 12 December 2024, the Cyprus House voted to transpose into law Council Directive (EU) 2022/2523 of 14 December 2022 to ensure a global minimum level of taxation of multinational enterprise groups and large domestic groups in the Union, also known as the Pillar Two Directive. The Law was published in the Official Government Gazette on 18 Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 149 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) December 2024. The Law introduces an IIR for financial years starting from 31 December 2023 in line with the Pillar Two Directive. A Qualified Domestic Minimum Top-up Tax (“QDMTT”) and an Undertaxed Profits Rule (“UTPR”) are also introduced for financial years starting from 31 December 2024. Therefore, as previously expected, the IIR rule applies to Kernel Group from 1 July 2024. Pillar 2 Rules also envisage the application of Safe Harbor tests, which are designed to simplify compliance in the initial years of implementation and reduce the risk of top-up tax in low-risk jurisdictions where the Group has presence. If a jurisdiction meets specific thresholds based on CbCR data, it has the right to be excluded from detailed GloBE calculations for a transitional period of the first three reporting years, starting from the year ending 30 June 2025. Namsen Ltd, as an Ultimate Parent Entity, conducted an assessment and concluded that most of the jurisdictions meet the Safe Harbor tests. Thus, the tax exposure for Kernel Group is possible only in jurisdictions where QDMTT applies, unless the CbCR Safe Harbor tests are met. It was assessed that the application of QDMTT had no material impact on the financial statements of the Group for the year ending 30 June 2025. Tax risk management is integrated into the Group's overall risk management. As of 30 June 2025, companies of the Group were involved in ongoing litigation with tax authorities concerning tax matters amounting to USD 27,238 thousand (30 June 2024: USD 20,441 thousand). Based on the Group’s historical experience with similar court cases, management believes it is unlikely that these proceedings will result in a significant outflow of resources, and accordingly, no provision has been recognized in the Group’s financial statements as at the reporting date. Ukraine’s tax environment remains complex and characterized by frequent changes in tax legislation and inconsistent application and interpreta- tion by the tax authorities. This environment may result in increased fiscal pressure on taxpayers. The risk of differing interpretations of tax laws and regulations, combined with evolving administrative practices can lead to disputes with the tax authorities and potentially result in additional tax assessments, fines and interest charges. The transfer pricing legislation allows for additional tax assessment in respect of controlled transactions (transactions between related parties and certain transactions between unrelated parties) if such transactions are not conducted on an arm’s-length basis. Management has established internal controls and documentation procedures to comply with applicable transfer pricing legislation. However, tax authorities may challenge the prices applied under these transactions, particularly as transfer pricing rules and interpretation continue to evolve. As of the reporting date, the potential impact of any such challenge is uncertain and cannot be reliably estimated. The Group assesses uncertain tax positions in accordance with IFRIC 23 and recognizes provisions where necessary. Key aspects of the Ukrainian tax system are the following: • Ukraine operates a classic corporate income tax system. Under this system, the taxable profit of companies, defined as accounting profit adjusted for tax differences in accordance with Ukrainian tax legislation, is subject to corporate income tax (“CIT”) at a statutory rate of 18 %. • Transfer pricing regulations apply to transactions with related non-resident parties and non-resident parties located in low tax jurisdictions (i.e., jurisdictions with an effective corporate income tax rate significantly lower than Ukraine’s 18% CIT rate). These rules are applicable where the company’s annual income exceeds UAH 150 million and the value of transactions with each such non-resident exceeds UAH 10 million. • The domestic supply of goods and services, as well as the import of goods and certain services, are subject to value-added tax at the standard rate of 20%. A 0% VAT rate applies to the export of goods from Ukraine. Starting from March 2021, a reduced VAT rate of 14% was applicable to the domestic supply and import of certain agricultural commodities. • Payments of passive income (such as interest, royalties, dividends, etc.) to non-resident recipients are subject to withholding tax at the standard rate 15% unless double tax treaties or the Tax Code of Ukraine provide another tax rate. • Agricultural producers of raw materials are eligible to apply a simplified tax regime, provided that at least 75% of their income is derived from the sale of agricultural raw materials produced by such companies. Under this regime, companies are subject to a fixed tax, which is determined based on the type, location, and monetary value of the farmland they operate. • The “Transitional Provisions” of the Tax Code of Ukraine have been supplemented by a new subparagraph 69.38, which provides that, tempo- rarily from 1 August 2023 until the termination or cancellation of martial law on the territory of Ukraine, taxpayers who voluntarily correct errors that resulted in an understatement of tax liabilities shall be exempt from the accrual and payment of fines and penalties. • The Diia City regime, which provides special tax and legal benefits for IT companies, has been introduced in Ukraine. Among other provisions, the regime offers protections against excessive state interference, streamlined hiring procedures for IT professionals (including the use of special "gig contracts"), and reduced income tax and payroll tax rates for qualifying IT businesses. As of 30 June 2025, the Group was a party to three legal cases in the District Court in Luxembourg, all initiated by eight shareholders who together held 1,210,430 shares as of February 2024, amounting to 0.4% of the Company's total issued shares: • merits proceedings initiated as of 13 October 2023 with the objective: 1) To establish that the Group's directors acted against the Group's interests, were conflicted, and lacked the necessary authority at the Board of Directors' meeting on 13 April 2023; 2) To invalidate all decisions made during the aforementioned Board meeting, including the resolution to delist the Group from the Warsaw Stock Exchange; 3) Alternatively, to appoint an expert to assess (i) the fairness of the public tender offer price announced by Namsen Ltd on 30 March 2023, compared to the real value of the Group, and (ii) the economic impact of the Board of Directors' decisions, including the delisting, on the Group's corporate interests. These proceedings are currently pending. • merits proceedings initiated on 20 February 2024 related mainly to the annulment of the Board of Directors' decisions made on 21 August and 1 September 2023, as mentioned above. Alternatively, the claimants seek compensation for damages from Namsen Ltd. These proceedings are currently pending. • merits proceedings initiated on 26 April 2024 related mainly to the annulment of the decisions taken at the AGM held on 11 December 2023. These proceedings are currently pending. Additionally, on 3 April 2024, the same group of minority shareholders initiated summary proceedings related mainly to the suspension of the Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 150 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) decisions taken at the AGM held on 11 December 2023. On 27 November 2024, the Vice-President of Luxembourg District Court issued a summary order under which all claims brought by the claimants in legal action against the Group and its majority shareholder, Namsen Ltd, to seek the suspension of the resolutions adopted during the Group's Annual General Meeting on 11 December 2023, were declared inadmissible and, there- fore, rejected. Additionally, the claimants were ordered to pay procedural indemnities to both the Group and Namsen Ltd. On 15 May 2025, the claimants filed the appeal. The appeal proceedings are currently pending. As of 28 March 2025, the Luxembourg District Court issued a summary order declaring inadmissible and consequently rejecting the claims initiated on 20 February 2024 against the Company and its majority shareholder, Namsen Ltd. The claims sought interim relief in the form of a suspension of decisions made by the Company’s Board of Directors regarding the share capital increase carried out in August–September 2023, including the issuance of 216,000,000 new shares, as previously disclosed. The Court further ordered the claimants to pay procedural indemnities to both the Group and Namsen Ltd. On 23 May 2025, the claimants filed an appeal. The appeal proceedings are currently pending. The proceedings are at an early stage, and the outcome of the litigation cannot be reliably assessed at this time. However, the Group’s management believes that there has been no non-compliance with applicable laws and regulations in relation to the matters raised by the claimants and, accord- ingly, no outflow of economic benefits is expected. 31. Financial risk management Capital Risk Management The Group manages its capital, primarily attributable to equity holders. The object is to ensure that entities in the Group continue as a going concern, providing returns to shareholders and benefits to other stakeholders, while maintaining an optimal capital structure to reduce the cost of capital. Management considers the cost of capital and the risks associated with each class of capital and balances its overall structure through dividend distributions, issuance or repurchase of shares, and the issuance or redemption of debt instruments. The Group monitors capital based on the carrying amount of equity and borrowings less cash and cash equivalents, as presented in the consoli- dated statement of financial position. The Group is not subject to any externally imposed capital requirements, other than covenants imposed by external lenders in respect of bank borrowings and bonds. Gearing Ratio The Group monitors its capital structure by calculating a gearing ratio, defined as net debt divided by total capital. Net debt comprises lease obligations, bonds and borrowings less cash and cash equivalents, while total capital consists of equity and net debt. Management has not established a formal target level for the gearing ratio but considers it an important measure of financial stability and access to financing. As of 30 June 2025, the majority of the Group’s debt is due within two to five years. As of 30 June 2025 As of 30 June 2024 Debt liabilities 1 (Notes 19, 20, 21) 760,791 1,090,098 Less cash and cash equivalents (Note 8) (617,511) (809,584) Net debt 143,280 280,514 Equity 2 2,077,929 1,864,643 Total capital 2,221,209 2,145,157 Net debt liabilities to capital 7% 15% Financial Risk The Group is exposed to financial risk as the result of the normal course of business and includes the following risks: • Credit risk • Liquidity risk • Market risk Risk management policies have been established to identify, assess, and analyze the risks faced by the Group, to manage and continuously improve an effective risk management and monitoring system, spreading the culture of decision-making in terms of risks, their valuation and likelihood of occurrence. The Group coordinates roles and participants through training, management standards, and procedures. Credit Risk Credit risk is the risk of financial loss to the Group if counterparties may not be able to settle their contractual obligations due to the Group within their agreed payment terms. The Group’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. The characteristics of the Group’s customer base, including the default risk of the industry and country in which the major customers operate, have less of an influence on credit risk. The Group has established a credit policy under which each new customer is assessed individually for creditworthiness before standard payment and delivery terms are offered. The review includes an evaluation of the customer’s financial position, payment history, transaction volume, and other relevant factors. Sales limits are set for each customer, representing the maximum exposure without requiring further management approval, 1 Debt includes short-term and long-term borrowings, obligations under leases, bonds issued and accrued interest. Debt liabilities do not include the liabilities associated with assets held for sale. 2 Equity includes issued capital, share-premium reserve, additional paid-in capital, revaluation reserve, retained earnings, other reserve and translation reserve attributable to Kernel Holding S.A. shareholders. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 151 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) and these limits are reviewed annually. Customers who do not meet the Group’s benchmark for creditworthiness may only transact on a prepaid basis and are subject to additional approval requirements. The Group’s maximum exposure to credit risk is disclosed in Note 32. To mitigate non-payment risk in international markets, the Group presents title documents through banking channels and makes use of payment instruments such as letters of credit, insurance arrangements, and bank guarantees. In addition, the Group holds collateral against loans provided to farmers, which includes future harvests, movable and immovable property. Collateral is secured in amounts sufficient to cover the loans based on current market prices. The Group’s policy on expected credit losses (“ECL”) for trade receivables is disclosed in Note 9. Other financial assets at amortized cost include loans to related parties, key management personnel and other receivables, all of which are considered to carry low credit risk. The Group’s most significant customer is an international customer, who accounted for USD 40,869 thousand out of total trade accounts receivable as of 30 June 2024 (30 June 2024: most significant customer is an international customer accounted for USD 31,643 thousand). The entity is also exposed to credit risk on debt investments measured at fair value through profit or loss, including Ukrainian government bonds and U.S. Treasury bonds (T-bonds). Ukrainian government and local bonds are subject to elevated credit risk due to the downgrade of Ukraine’s sovereign credit rating since the beginning of the war, while U.S. Treasury bonds are considered to carry low credit risk given the sovereign credit standing of the United States. Ukrainian government bonds in amount of USD 133,359 thousand are rated C (30 June 2024: USD 185,310 thousand are rated CC) and U.S. Treasury bonds in amount of USD 11,043 thousand are rated F1+ (30 June 2024: nil) by Fitch respectively. As of 30 June 2025, 74% (30 June 2024: 59%) of margin accounts with brokers are conducted with the financial institutions rated at F1-B by Fitch (or analog). Short-term bank deposits are held by the Group in the international banks and Ukrainian subsidiaries of international banks with high ratings (F1+ - F by Fitch). The Group’s exposure to credit risk for margin accounts with brokers is significantly reduced by placing them with financial institutions that hold a strong Fitch credit rating of “B” or above, reflecting a high level of creditworthiness. Liquidity Risk Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group manages liquidity risk by maintaining adequate cash and cash equivalents, as well as the availability of funding through the adequacy of the banking facilities by continuously monitoring forecasted and actual cash flows and by matching the maturity profiles of financial assets and liabilities. Management diversifies funding sources to ensure that sufficient liquidity is maintained to meet liquidity requirements. As of 30 June 2025, the carrying amount of the Group’s maximum exposure to financial obligations (including lease liabilities) was USD 925,297 thousand (30 June 2024: USD 1,286,752 thousand). All contracts are expected to settle within 12 months. The Group manages liquidity risk by maintaining sufficient cash and cash equivalents The Group regularly monitors its liquidity position to ensure that it has the ability to meet its short-term obligations. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 152 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) The following table details the Group’s remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods as of 30 June 2025 and 2024. The table has been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Group can be required to pay. The tables include both interest and principal cash flows. Carrying amount Contractual cash flows Less than 1 year 1–2 years 2–5 years More than 5 years 30 June 2025 Non-derivative financial liabilities Bonds issued (Note 20) 302,103 350,625 20,250 20,250 310,125 — Short-term borrowings (Note 19) 148,887 148,887 148,887 — — — Trade accounts payable 108,348 108,348 108,348 — — — Long-term borrowings, including current portion (Note 19) 104,546 122,834 28,429 27,929 63,125 3,351 Lease liabilities (Note 21) 205,255 479,906 35,191 39,281 135,310 270,124 Other current liabilities (Note 18) 41,247 41,247 41,247 — — — Other non-current liabilities 3,364 3,364 — 657 2,707 — Total 913,750 1,255,211 382,352 88,117 511,267 273,475 Derivatives Open currency swap contracts Inflows 172,000 172,000 172,000 — — — Outflows (173,251) (173,251) (173,251) — — — Derivative financial instruments (Note 18) 11,547 11,547 11,547 — — — Total 10,296 10,296 10,296 — — — 30 June 2024 Non-derivative financial liabilities Bonds issued (Note 20) 605,192 605,192 605,192 — — — Short-term borrowings (Note 19) 315,166 315,166 315,166 — — — Trade accounts payable 109,672 109,672 109,672 — — — Lease liabilities (Note 21) 169,740 393,130 29,811 36,367 111,504 215,448 Other current liabilities (Note 18) 75,550 75,550 75,550 — — — Other non-current liabilities 986 986 — 493 493 — Total 1,276,306 1,499,696 1,135,391 36,860 111,997 215,448 Derivatives Open currency swap contracts Inflows 249,500 249,500 249,500 — — — Outflows (249,590) (249,590) (249,590) — — — Derivative financial instruments (Note 18) 10,446 10,446 10,446 — — — Total 10,356 10,356 10,356 — — — The concentration of liquidity risk is limited due to different repayment terms of financial liabilities and sources of borrowing facilities. Market Risk The Group`s activities expose it primarily to market risk which is mainly presented as the risk of loss in the value of any financial instrument due to an adverse fluctuation in market prices, interest rates, and foreign exchange rates, whether arising out of factors affecting specific instruments or the market in general. The goal of market risk management is to control and manage market risk exposures within acceptable limits while maxim- izing the return on those risks. Currency Risk The functional currency of the majority of the Group’s Subsidiaries is their local currency, except for businesses engaged in the production and sale of sunflower oil and transshipment services, for which USD was selected as the functional currency. Currency risk is a risk of financial impact due to exchange rate fluctuations related to transactions and balances in currencies other than functional currency. The Group enters into such transactions denominated in other currencies, which include capital expenditures, operating expenses, certain sales of goods, and recognized assets and liabilities denominated in a currency that is not the functional currency of the entity. Exposure of currency risk is managed by utilizing currency forward contracts and fulfilling comparative analysis between subsidiaries. The Group mitigates the influence of currency risk in Ukrainian hryvnia through export sales denominated in USD and EUR. For the year ended 30 June 2025, total sales denominated in USD amounted to USD 3,834,995 thousand, and total sales denominated in EUR amounted to USD 57,929 thousand (for the year ended 30 June 2024: USD 3,250,287 thousand and USD 64,367 thousand, respectively). The Group also utilizes currency swaps, which are derivative instruments under which principal and interest payments are exchanged in different currencies. These contracts are used to mitigate foreign exchange risks arising from exposures in currencies other than USD across various financial instruments, and they also enable the Group to optimize its overall financing costs. As of 30 June 2025, the Group’s management monitors the notional amounts and fair values of these instruments on an ongoing basis. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 153 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) As of 30 June 2025, the Group had open currency swap contracts, all of which are expected to settle within 12 months. The Group continuously monitors these positions to ensure sufficient liquidity is available to meet the related contractual obligations. As of 30 June 2025, the Group’s borrowings are denominated primarily in USD and UAH. Interest and principal payments on borrowings are generally matched with cash flows generated by the Group’s operations, particularly from export sales denominated in USD. This provides a natural hedge against currency risk for the USD-denominated debt, while borrowings in UAH are used to finance local operating needs. Accordingly, the Group does not utilize derivative instruments to hedge such exposures. The table below covers UAH and USD-denominated assets and liabilities carried by Subsidiaries having balances in currencies other than functional currencies. The Group’s exposure to foreign currency risk, including the balances outstanding between the Group’s companies as of 30 June 2025 and 2024 was as follows: 30 June 2025 30 June 2024 UAH USD UAH USD Cash and cash equivalents 152,421 6,702 132,254 163,471 Trade accounts receivable 46,411 101,036 50,856 94,427 Other financial assets 246,920 — 177,655 — Trade accounts payable (93,808) (7) (69,585) (1,320) Current portion of lease liabilities (1,050) — (644) — Lease liabilities (7,626) — (6,855) — Short-term borrowings from Ukrainian subsidiary of European bank (93,836) — (88,071) — Long-term borrowings European Bank — (10,140) — (12,628) Open currency swap contracts (173,251) — (249,590) — Other financial liabilities (226,202) (87) (189,232) (642) Other non-current liabilities (2,527) — (3,081) — Net exposure (152,548) 97,504 (246,293) 243,308 The following table details the Group’s sensitivity to a 10 % change of the UAH against the USD would prompt a fluctuation in the equity and profit and loss account by the amounts shown below. This sensitivity analysis assumes that all other variables, in particular interest rates, remain con- stant. The sensitivity analysis includes only outstanding monetary items denominated in a currency other than the functional currency. A strengthening/depreciation of the UAH against USD on 30 June would have affected the measurement of financial instruments denominated in a foreign currency and affected profit or loss before income tax by the amounts shown below: 30 June 2025 30 June 2024 Strengthening Depreciation Strengthening Depreciation UAH (10% movement) (24,119) 26,089 (46,748) 51,664 Interest Rate Risk The Group’s main interest rate risk arises from bank borrowings and lease liabilities with variable rates, which expose the group to cash flow interest rate risk. The sensitivity analysis in the table below has been determined based on exposure to interest rates for financial liabilities at the end of the reporting period. For floating rate liabilities, the analysis was prepared assuming the amount of liability outstanding at the end of the reporting period was outstanding for the whole year. A 100-basis point (“bp”) increase, or decrease, was used when reporting interest rate risk internally to key man- agement personnel and represents management’s assessment of reasonably possible changes in interest rates. The interest rate profile of the Group’s interest-bearing financial instruments and its sensitivity to increase or decrease of variable interest rate was as follows: Carrying amount as of 30 June 2025 Impact on profit before tax from change in variable rates Carrying amount as of 30 June 2024 Impact on profit before tax from change in variable rates 100 bp higher 100 bp lower 100 bp higher 100 bp lower Fixed rate 626,248 873,561 Variable rate 134,543 (1,346) 1,346 216,538 (2,166) 2,166 SOFR 90,564 (906) 906 162,157 (1,622) 1,622 COF 28,006 (280) 280 29,686 (297) 297 UIRD 15,016 (150) 150 23,738 (237) 237 LIBOR 957 (10) 10 957 (10) 10 Total 760,791 (1,346) 1,346 1,090,099 (2,166) 2,166 The Group does not use any derivatives to manage interest rate risk exposure. The Group manages its interest rate risk by having a balanced portfolio of fixed and variable-rate loans and borrowings. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 154 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) Commodity Price Risk The Group is exposed to fluctuations in commodity prices for inventories and the product of production which are not held to meet forward priced contracts. The Group is exposed to commodity price risk due to its core activities in the production, processing, and sale of agricultural products such as grains, oilseeds, and other commodities. Commodity prices are inherently volatile and influenced by a broad range of external factors including global supply-demand dynamics, geopolitical tensions, weather conditions, trade regulations, currency movements, and transportation disruptions. The Group remains fully exposed to changes in market prices, which can have a direct and material impact on its financial results. A significant decline in the price of key agricultural commodities may negatively affect revenue, gross profit, and operating cash flows. Throughout the 2025 marketing year, shipments via Ukraine’s Black Sea ports operated without disruptions, ensuring stable and efficient export flows. This operational consistency significantly enhanced the predictability of trading activities, improved the planning of trading books, and sup- ported effective market risk management. The reliable functioning of these ports reinforced confidence in Ukrainian-origin supply chains across key global consumption markets. The stabilization and gradual reduction of freight and insurance premiums for shipments from Ukrainian Black Sea ports, relative to alternative ports such as Constanta and Varna, positively impacted the Group’s financial performance. This stability allowed for increased agility in our trade flows and improved our ability to respond efficiently to dynamic changes in global commodity markets. Looking ahead, no significant changes are anticipated in 2026 marketing year, as the export infrastructure continues to operate reliably. In 2025 financial year, the Group was exposed to commodity price risk arising from compressed crush margins, which reflected a combination of below-average oilseed supply in Ukraine, particularly sunflower, and increased farmer holding capacity. Elevated volatility in global vegetable oil markets, driven by changes in palm oil availability and energy prices, led to irregular selling patterns by farmers, resulting in periods of reduced crush coverage compared with historical levels. To mitigate these risks, the Group applied a margin-driven switching strategy across its main oilseeds (sunflower seeds, rapeseeds and soybeans), thereby broadening its product mix and trading opportunities. Risk management measures included the use of commercial tools, internal logistical solutions, and close coordination between trading and origination functions to align pro- curement and processing activities. These actions enabled the Group to manage exposure to commodity price fluctuations and reduce the potential adverse impact on earnings. Furthermore, the Group assesses potential exposures through internal sensitivity analysis and scenario testing, considering the potential impact of price movements on profitability and liquidity. These assessments support proactive planning, particularly during periods of elevated market stress or expected volatility. Management remains focused on enhancing risk management practices through operational excellence and improved market responsiveness. The Group measures and limits market risk exposure using a Value at Risk computation for commodity price risk related to its physical marketing activities. Value at Risk (VaR) is used by the Group as a statistical measure to estimate the potential loss in value of positions due to adverse market movements under normal market conditions. The Group calculates VaR over a one-day time horizon with a 95 percent confidence level, using a Parametric VaR model based on a log-normal assumption of returns. Parameters are estimated using an Exponentially Weighted Moving Average over a 75-day period with a decay factor of 0.94. The VaR model has inherent limitations: it does not capture the liquidity of different risk positions and therefore does not estimate potential losses if the Group liquidates large positions over a short period of time. In addition, the model relies on historical market data, which may not necessarily reflect future market conditions. As of 30 June 2025, the Group’s VaR amounted to USD 5,400 thousand (30 June 2024: USD 6,100 thousand). The Group’s VaR should be interpreted taking into account the limitations of the methodologies applied. These limitations include: • The VaR model does not capture the liquidity of different risk positions and therefore does not estimate potential losses if the Group liquidates large positions over a short period. • VaR is based on historical data that may not provide the best estimate of the joint distribution of risk factor changes in the future and may fail to capture the risk of extreme adverse market movements that have not occurred within the historical window used for calculation. • Model risk: VaR’s accuracy depends on the methods and assumptions used. In particular, the parametric model assumes a log-normal distribu- tion of returns, which may not hold in real markets. 32. Financial Instruments The following tables give information on the carrying and fair values of the financial instruments. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In the absence of market values, fair values have been estimated by discounting expected cash flows at prevailing market interest and exchange rates. These estimated fair values have been determined using market information and appropriate valuation methodologies but may not necessarily reflect the amounts that the company could realize in the normal course of business. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 155 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) As of 30 June 2025 and 2024, the financial assets and liabilities are presented by class in the tables below at their carrying values: As of 30 June 2025 As of 30 June 2024 Amortized cost FVTPL 1 Total Amortized cost FVTPL 1 Total Assets Cash and cash equivalents (Note 8) 617,511 — 617,511 809,584 — 809,584 Trade accounts receivable (Note 9) 252,660 — 252,660 305,246 — 305,246 Other financial assets (Note 13) measured at Amortized cost of which Margin account with brokers 67,491 — 67,491 82,215 — 82,215 Loans granted 46,437 — 46,437 22,306 — 22,306 Other financial assets 19,467 — 19,467 10,760 — 10,760 Short-term bank deposits 12,000 — 12,000 12,747 — 12,747 Pledge deposits — — — 1,303 — 1,303 Other financial assets (Note 13) measured at FVTPL of which Government bonds — 144,402 144,402 185,310 185,310 Derivative financial instruments — 26,116 26,116 25,288 25,288 Non-current financial assets 6,025 — 6,025 23,307 — 23,307 As of 30 June 2025 As of 30 June 2024 Amortized cost FVTPL 1 Total Amortized cost FVTPL 1 Total Liabilities Trade accounts payable 108,348 — 108,348 109,672 — 109,672 Borrowings (Note 19) 253,433 — 253,433 315,166 — 315,166 Lease liabilities 205,255 — 205,255 169,740 — 169,740 Bonds issued and interest accrued (Note 20) 302,103 — 302,103 605,192 — 605,192 Other financial liabilities (Note 18) measured at Amortized cost of which Accounts payable for property, plant and equipmen 5,650 — 5,650 5,896 — 5,896 Other current liabilities 5,657 — 5,657 3,413 — 3,413 Other financial liabilities (Note 18) measured at FVTPL of which Share-based options — 29,940 29,940 — 66,241 66,241 Derivative financial instruments — 11,547 11,547 — 10,446 10,446 Other non-current liabilities 3,364 — 3,364 800 186 986 The following table below represents a comparison of carrying amounts and fair value of the financial instruments for which they differ: As of 30 June 2025 As of 30 June 2024 Financial liabilities Carrying amount Fair value Carrying amount Fair value Bonds issued (Note 20) 2 302,103 267,840 605,192 484,290 Long-term borrowings, including current portion (Note 19) 104,545 105,008 — — For the year ended 30 June 2025, the fair value of bank long-term borrowings was estimated by discounting the expected future cash outflows by a market rate of interest for bank borrowings of 6.77% that is within level 2 of the fair value hierarchy. The fair value of Bonds issued was estimated based on directly observable quotations within Level 2 of the fair value hierarchy. Derivative instruments are carried at fair value for which the Group evaluates the quality and reliability of the assumptions and data used to measure fair value in the two hierarchy levels, Level 1 and 2, as prescribed by IFRS 13 Fair Value Measurement. Fair values are determined in the following ways: externally verified via comparison to quoted market prices in active markets (Level 1) or by observable quoted prices sourced from exchanges or brokers in active markets for identical assets or liabilities (Level 2). Valuation of the Group’s commodity physical forward contracts categorized within level 2 is based on observable quoted prices sourced from exchanges or traded reference indices in active markets for identical assets or liabilities and broker markups derived from observable quotations representing differentials, as required, including geographic location and local supply and demand. 1 FVTPL – Fair value through profit and loss. 2 Including accrued interests Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 156 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) The following table below represents the fair values of the derivative financial instruments including trade-related financial and physical forward purchase as of 30 June 2025 and 2024: As of 30 June 2025 As of 30 June 2024 Level 1 Level 2 Total Level 1 Level 2 Total Other financial assets Forwards — 11,974 11,974 — 9,964 9,964 Futures/Options 14,142 — 14,142 15,324 — 15,324 Other financial liabilities Forwards — 9,978 9,978 — 9,224 9,224 Currency swap contracts — 1,251 1,251 — — — Futures/Options 318 — 318 1,222 — 1,222 The major part of other financial liabilities has contractual maturity due within 6 months. Cash and cash equivalents and short-term borrowings and government bonds are classified as level 2 fair values in the fair value hierarchy due to the inclusion of directly and indirectly observable inputs. Trade receivables, other current assets and trade accounts payable, other current liabilities are classified as level 3 fair values in the fair value hierarchy due to the inclusion of unobservable inputs including counterparty credit risk. For the year ended 30 June 2025 and 30 June 2024, the fair value of other non-current assets recognized at amortized cost was estimated by discounting the expected future cash outflows by a market rate of interest for bank borrowings of 5-10% that is within level 3 in the fair value hierarchy due to the inclusion of unobservable inputs including counterparty credit risk. There were no transfers between levels of the fair value hierarchy. There were no changes in the valuation technique since the previous year. Offsetting of financial assets and liabilities The derivative asset and liability are offset, and the net amount is presented in the statement of financial position when the Group has a legally enforceable right to offset the recognized amounts and intends to either settle on a net basis or realize the asset and settle the liability simultane- ously. As of 30 June 2025, Other financial assets include collaterals for derivatives as part of the margin accounts with brokers in the amount of USD 64,501 thousand (30 June 2024: USD 76,049 thousand). Cash collateral does not qualify for offsetting in accordance with IAS 32, as it does not satisfy the criteria of a legally enforceable right of set-off and the intention to settle on a net basis. However, under the terms of collateral agreements (e.g., ISDA master netting arrangements), the Group is permitted to offset cash collateral against the net amount of derivative assets and liabilities in the event of default. Such rights of set-off are disclosed in accordance with IFRS 7 but are not recognized in the statement of financial position. The financial assets and liabilities, which meet the criteria of offsetting as of 30 June 2025 were as follows: Amounts set off in the statement of financial position Amounts not subject to netting agreements Total as presented in the consolidated statements of financial position Gross amount Amounts offset Net amount Derivative assets 178,508 (164,366) 14,142 3,986 18,128 Derivative liabilities (164,685) 164,366 (319) (9,579) (9,898) Total 13,823 — 13,823 (5,593) 8,230 The financial assets and liabilities, which meet the criteria of offsetting as of 30 June 2024 were as follows: Amounts set off in the statement of financial position Amounts not subject to netting agreements Total as presented in the consolidated statements of financial position Gross amount 1 Amounts offset 1 Net amount Derivative assets 91,140 (75,817) 15,323 10,001 25,324 Derivative liabilities (77,142) 75,817 (1,325) (9,122) (10,447) Total 13,998 — 13,998 879 14,877 1 During the year ended 30 June 2025, the Group made certain corrections and reclassifications, please see Note 4 for more details. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 157 www.ker nel.ua The accompanying notes are an integral part of these financial statements. Management Report Sustainability Statement Corporate Governance Financial Statements Notes to the Consolidated Statements continued for the year ended 30 June 2025 (in thousands of US dollars, unless otherwise stated) 33. Earnings per Share Basic earnings per share are computed by dividing net income from continuing operations available to ordinary shareholders by the weighted average number of ordinary shares outstanding (as of 30 June 2025 and 2024, 293,129,230 and 293,429,230 shares, respectively, and the weighted average number of ordinary shares in the number of 293,276,353 and 256,839,066 shares for the periods then ended, respectively), excluding any dilutive effects of stock options. Diluted earnings per share are computed in the same way as basic earnings per share, except that the weighted average number of ordinary shares outstanding is increased to include additional shares. The number of additional shares is calcu- lated by assuming that outstanding stock options, except those that are not dilutive, were exercised and that the proceeds from such an exercise were used to acquire ordinary shares at the average market price during the reporting period. For calculating diluted earnings per share, as of 30 June 2025, an average number of 293,276,353 ordinary shares is considered (30 June 2024: 256,839,066). 34. Subsequent Events As of 29 July 2025, the Group received a notification from its majority shareholder, Namsen Ltd, which currently holds 278,947,016 shares repre- senting 95.07% of the total voting rights, regarding the initiation of the sell-out procedure. No outflow of economic benefits for the Group will occur as the result of this transaction. Kernel Holding S.A. Annual Report and Accounts for the year ended 30 June 2025 | 158 www.ker nel.ua Management Report Sustainability Statement Corporate Governance Financial Statements Corporate information Registered office Kernel Holding S.A., Société anonyme 8A, Boulevard Joseph II L-1840 Luxembourg Registered number B109173 Auditors PricewaterhouseCoopers Assurance, Société cooperative, 2, rue Gerhard Mercator B.P. L-1014 Luxembourg Investor relations Mr. Yuriy Kovalchuk, Corporate Investment Director Mr. Michael Iavorskyi, Investor Relations Manager Ms. Anastasiia Nesterenko, Investor Relations Specialist ir@kernel.lu Kernel Holding S.A. Investor Calendar Q1 FY2026 Operations Update 24 October 2025 Q1 FY2026 Financial Report 28 November 2025 Annual general shareholders’ meeting 10 December 2025 Q2 FY2026 Operations Update 22 January 2026 H1 FY2026 Financial Report 27 February 2026 Q3 FY2026 Operations Update 20 April 2026 Q3 FY2026 Financial Report 29 May 2026 Q4 FY2026 Operations Update 20 July 2026 FY2026 Financial Report 02 October 2026 Stock information Exchange Warsaw Stock Exchange Stock quote currency PLN Shares issued as of 30 June 2025 293,429,230 Bloomberg KER PW Refinitiv Eikon ticker KER.WA ISIN code LU0327357389 Cautionary statement Certain statements in this document are for- ward-looking statements. By their nature, for- ward-looking statements involve a number of risks, uncertainties, or assumptions that could cause actual results or events to differ materi- ally from those expressed or implied by the forward-looking statements. These risks, un- certainties, or assumptions could adversely affect the outcome and financial effects of the plans and events described herein. Forward- looking statements contained in this document regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. You should not place undue reliance on forward- looking statements, which speak only as of the date of this announcement. Except as re- quired by law, the Company is under no obli- gation to update or keep current the forward- looking statements contained in this document or to correct any inaccuracies that may be- come apparent in such forward-looking state- ments. This document does not constitute or form part of any offer or invitation to sell or pur- chase, or any solicitation of any offer to sell or purchase any shares or securities. It is not in- tended to form the basis upon which any in- vestment decision or any decision to purchase any interest in Kernel Holding S.A. is made. Information in this document relating to the price at which investments have been bought or sold in the past or the yield on investments cannot be relied upon as a guide to future per- formance. 5493003GR6L4DZOS2U122025-06-305493003GR6L4DZOS2U122024-06-305493003GR6L4DZOS2U122024-07-012025-06-305493003GR6L4DZOS2U122023-07-012024-06-305493003GR6L4DZOS2U122023-06-30ifrs-full:IssuedCapitalMember5493003GR6L4DZOS2U122023-07-012024-06-30ifrs-full:IssuedCapitalMember5493003GR6L4DZOS2U122024-06-30ifrs-full:IssuedCapitalMember5493003GR6L4DZOS2U122023-06-30ifrs-full:SharePremiumMember5493003GR6L4DZOS2U122023-07-012024-06-30ifrs-full:SharePremiumMember5493003GR6L4DZOS2U122024-06-30ifrs-full:SharePremiumMember5493003GR6L4DZOS2U122023-06-30ifrs-full:AdditionalPaidinCapitalMember5493003GR6L4DZOS2U122023-07-012024-06-30ifrs-full:AdditionalPaidinCapitalMember5493003GR6L4DZOS2U122024-06-30ifrs-full:AdditionalPaidinCapitalMember5493003GR6L4DZOS2U122023-06-30ifrs-full:TreasurySharesMember5493003GR6L4DZOS2U122023-07-012024-06-30ifrs-full:TreasurySharesMember5493003GR6L4DZOS2U122024-06-30ifrs-full:TreasurySharesMember5493003GR6L4DZOS2U122023-06-30ifrs-full:RevaluationSurplusMember5493003GR6L4DZOS2U122023-07-012024-06-30ifrs-full:RevaluationSurplusMember5493003GR6L4DZOS2U122024-06-30ifrs-full:RevaluationSurplusMember5493003GR6L4DZOS2U122023-06-30ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember5493003GR6L4DZOS2U122023-07-012024-06-30ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember5493003GR6L4DZOS2U122024-06-30ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember5493003GR6L4DZOS2U122023-06-30ifrs-full:RetainedEarningsMember5493003GR6L4DZOS2U122023-07-012024-06-30ifrs-full:RetainedEarningsMember5493003GR6L4DZOS2U122024-06-30ifrs-full:RetainedEarningsMember5493003GR6L4DZOS2U122023-06-30ifrs-full:EquityAttributableToOwnersOfParentMember5493003GR6L4DZOS2U122023-07-012024-06-30ifrs-full:EquityAttributableToOwnersOfParentMember5493003GR6L4DZOS2U122024-06-30ifrs-full:EquityAttributableToOwnersOfParentMember5493003GR6L4DZOS2U122023-06-30ifrs-full:NoncontrollingInterestsMember5493003GR6L4DZOS2U122023-07-012024-06-30ifrs-full:NoncontrollingInterestsMember5493003GR6L4DZOS2U122024-06-30ifrs-full:NoncontrollingInterestsMember5493003GR6L4DZOS2U122023-06-305493003GR6L4DZOS2U122024-07-012025-06-30ifrs-full:IssuedCapitalMember5493003GR6L4DZOS2U122025-06-30ifrs-full:IssuedCapitalMember5493003GR6L4DZOS2U122024-07-012025-06-30ifrs-full:SharePremiumMember5493003GR6L4DZOS2U122025-06-30ifrs-full:SharePremiumMember5493003GR6L4DZOS2U122024-07-012025-06-30ifrs-full:AdditionalPaidinCapitalMember5493003GR6L4DZOS2U122025-06-30ifrs-full:AdditionalPaidinCapitalMember5493003GR6L4DZOS2U122024-07-012025-06-30ifrs-full:TreasurySharesMember5493003GR6L4DZOS2U122025-06-30ifrs-full:TreasurySharesMember5493003GR6L4DZOS2U122024-07-012025-06-30ifrs-full:RevaluationSurplusMember5493003GR6L4DZOS2U122025-06-30ifrs-full:RevaluationSurplusMember5493003GR6L4DZOS2U122024-07-012025-06-30ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember5493003GR6L4DZOS2U122025-06-30ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember5493003GR6L4DZOS2U122024-07-012025-06-30ifrs-full:RetainedEarningsMember5493003GR6L4DZOS2U122025-06-30ifrs-full:RetainedEarningsMember5493003GR6L4DZOS2U122024-07-012025-06-30ifrs-full:EquityAttributableToOwnersOfParentMember5493003GR6L4DZOS2U122025-06-30ifrs-full:EquityAttributableToOwnersOfParentMember5493003GR6L4DZOS2U122024-07-012025-06-30ifrs-full:NoncontrollingInterestsMember5493003GR6L4DZOS2U122025-06-30ifrs-full:NoncontrollingInterestsMemberiso4217:USDxbrli:sharesiso4217:USDxbrli:shares