ALS LIMITED - Annual Report 2023 | FinancialReports.eu

ALS Limited

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Appendix 4E

Full year report for the Year Ending 31 March 2023

(the previous corresponding period is the Year Ended 31 March 2022)

Results for announcement to the market

				$A millions
Revenues from ordinary activities	Up	14.7%	to	2,400.9
Revenues from underlying continuing operations	Up	19.5%	to	2,421.2
Underlying net profit after tax * from continuing
operations attributable to members	Up	23.4%	to	320.6
Net profit from ordinary activities after tax *
attributable to equity holders	Up	52.9%	to	291.2
Net profit for the period * attributable to equity
holders	Up	52.9%	to	291.2
Basic underlying * earnings per share attributable to
members from continuing operations	Up	23.2%	to	66.3¢
Basic earnings per share	Up	52.7%	to	60.2¢
Total dividend per share for the year (partly
franked)	Up	21.0%	at	39.7¢
ALS Limited (ASX Code: ALQ) today announced an underlying net profit after tax			from continuing
operations of $320.6 million for FY2023. The result was 23.4% higher than the $259.9 million
comparative underlying net profit after tax from continuing operations earned in			the previous
corresponding period (pcp).
The FY2023 statutory result from all operations was a	net profit after tax attributable to equity holders of
the Company of $291.2 million, compared with a net	profit of $190.5 million recorded in			FY2022.
*Refer to page 7 of the attached Annual Financial Statements for a reconciliation			of Underlying net
profit after tax to Statutory net profit after tax.

See chapter 19 for defined terms

Appendix 4E – Page 1

Results for Announcement to the market for the year ended 31 March 2023

ALS LIMITED

Dividend Disclosures

Dividends (distributions) Amount per security Franked	Dividends (distributions) Amount per security Franked	amount per security
Final dividend	19.4¢	1.9¢
Interim dividend	20.3¢	Nil
Date the final dividend (distribution) is payable		6 July 2023
+Record date to determine entitlements to the	dividend (distribution) (i.e.,
on the basis of proper instruments of transfer received by 5.00 pm if
+securities are not +CHESS approved, or	security holding balances	13 June 2023
established by 5.00 pm or such later time permitted by SCH Business Rules
if +securities are +CHESS approved)
DRP election date		N/A

Dividend - Amount per security

Dividend - Amount per security
	Amount per security	Amount per security of conduit foreign income
Final dividend: Current year Previousyear	19.4¢ 17.0¢	17.5¢ 11.9¢
Interim dividend:Current year Previousyear	20.3¢ 15.8¢	20.3¢ 11.1¢

Total final dividend (distribution) on all securities

	+Ordinary securities_(each class separately) Preference+securities(each class_ separately) Other equity instruments_(each class_ separately) Total	Current period $A millions	Previous corresponding period -$A millions
		93.9 - -	82.2 - -
		93.9	82.2

The 2023 final dividend will be franked to 10%. Future dividends will be franked at the maximum level possible. The Company’s dividend reinvestment plan will remain suspended for the final dividend.

See chapter 19 for defined terms

Appendix 4E – Page 2

Results for Announcement to the market for the year ended 31 March 2023

ALS LIMITED

NTA backing

NTA backing
	Current period	Previous corresponding period
Net tangible asset backing per ordinary security ^	($0.55)	($0.54)

^ Net Tangible Assets (NTA) are calculated excluding the Group’s right-of-use assets (ROU) assets.

Audit

The report is based on the attached accounts which have been audited.

Signature: Date: 29 May 2023

Print name: Michael Pearson Company Secretary

See chapter 19 for defined terms

Appendix 4E – Page 3

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ALS Limited ABN 92 009 657 489

ANNUAL FINANCIAL STATEMENTS

For the year ended 31 March 2023

ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

Directors’ report ................................................................................................................................... 3 Directors ...........................................................................................................................................................................3 Company Secretary ............................................................................................................................................................5 Principal activities ..............................................................................................................................................................5 Review of results and operations .......................................................................................................................................6 Dividends ....................................................................................................................................................................... 12 Debt profile .................................................................................................................................................................... 13 Financial position ............................................................................................................................................................ 13 Cash flow ........................................................................................................................................................................ 14 Material business risks .................................................................................................................................................... 15 Task Force on Climate-related Financial Disclosures (TCFD) .............................................................................................. 18 Environmental regulation ............................................................................................................................................... 26 Indemnification and insurance of directors and officers ................................................................................................... 27 State of affairs ................................................................................................................................................................ 27 A letter from the chairman – unaudited ................................................................................................ 28 Remuneration report – audited ............................................................................................................ 30 Our global business and Key Management Personnel ...................................................................................................... 30 Snapshot of FY23 ............................................................................................................................................................ 32 Executive Remuneration Framework ............................................................................................................................... 35 The link between performance and reward ..................................................................................................................... 38 Link between performance, remuneration outcomes and shareholder wealth .............................................................. 43 Short Term Incentive Plan ............................................................................................................................................... 44 Long Term Incentive Plan ................................................................................................................................................ 45 Incentive plan governance .............................................................................................................................................. 49 Non-Executive Director Remuneration ............................................................................................................................ 50 Other Statutory Disclosures ............................................................................................................................................ 52 Events subsequent to reporting date ............................................................................................................................... 59 Likely developments ....................................................................................................................................................... 59 Directors’ interests ......................................................................................................................................................... 59 Directors’ meetings ......................................................................................................................................................... 59 Non-audit services .......................................................................................................................................................... 60 Financial statements ........................................................................................................................... 61 Contents ......................................................................................................................................................................... 61 Consolidated statement of profit and loss and other comprehensive income ................................................................... 62 Consolidated balance sheet ............................................................................................................................................ 63 Consolidated statement of changes in equity .................................................................................................................. 64 Consolidated statement of cash flows ............................................................................................................................. 65 Notes to the financial statements .................................................................................................................................... 66 Directors’ declaration ....................................................................................................................... 106 Independent auditor’s report to the members of ALS Limited ............................................................... 107 Lead auditor’s independence declaration ............................................................................................ 113

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2023 | Annual Financial Statements

ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

Directors’ report

For the year ended 31 March 2023

The Directors present their report together with the financial report of the Group, comprising ALS Limited (“the Company”) and its subsidiaries, for the year ended 31 March 2023 and the auditor’s report thereon.

DIRECTORS

The Directors of the Company at any time during or since the end of the financial year are:

BRUCE PHILLIPS

B Sc (Hons) (Geology) Chairman and Independent Non-Executive Director Age 68

Bruce Phillips was appointed a Non-Executive Director of the Company on 1 August 2015 and became Chairman on 26 July 2016 following the 2016 Annual General Meeting. Bruce is a qualified geophysicist with more than 40 years of technical, financial and managerial experience in the energy sector.

He founded Australian Worldwide Exploration Limited (now Mitsui) in 1997 and was its Managing Director until his retirement in 2007. He re-joined as a Non-Executive Director in 2009 and held the position of Chairman until his retirement from the Board in November 2017. He was previously Chairman of Platinum Capital Limited (October 2009 – June 2015) and a Non-Executive Director of AGL Energy Limited (August 2007 – September 2016) and Sunshine Gas Limited. In January 2019 Bruce was appointed as a Non-Executive Director and Chairman of Karoon Energy Limited.

He is a member of the People Committee and Chairman of the Nomination Committee.

RAJ NARAN

B Sc (Chemistry), B A (Mathematics) Former Managing Director and Chief Executive Officer

Age 61

Appointed Managing Director and Chief Executive Officer on 20 July 2017.

Raj founded e-Lab Analytical Inc which operated an environmental analytical testing business in Texas and Michigan until it was acquired by the Group in 2007. He was appointed to lead ALS USA Environmental business at that time and grew his role over the subsequent years to lead the global Life Sciences Division until his appointment to CEO in 2017.

He resigned as Managing Director and Chief Executive on 7 March 2023.

JOHN MULCAHY PhD, B E (Civil Eng) (Hons), FIE Aust Independent Non-Executive Director Age 73

John Mulcahy was appointed a Non-Executive Director of the Company in 2012. He is Chairman of Orix Australia Corporation Limited, an unlisted public company (appointed March 2016), and Deputy Chairman of GWA Group Limited (appointed November 2010). He is also a current Non-Executive Director of various Zurich Australia Insurance subsidiaries. John was previously a director and Chairman of both Mirvac Group Limited (November 2009 – December 2022) and Coffey International Limited (September 2009 – January 2016). He is a former Guardian of the Future Fund of Australia and former Managing Director and Chief Executive Officer of Suncorp-Metway Limited. Prior to Suncorp, John held a number of senior executive roles at the Commonwealth Bank and Lend Lease Corporation.

He is a member of the People Committee, the Audit and Risk Committee and the Nomination Committee.

CHARLIE SARTAIN

B Eng (Hons) (Mining), FAusIMM, FTSE

Independent Non-Executive Director Age 62

Charlie Sartain was appointed a Non-Executive Director of the Company on 1 February 2015. He spent more than 30 years with MIM Holdings and then Xstrata plc after it acquired MIM. He led Xstrata’s global copper business as Chief Executive of Xstrata Copper for nine years from 2004 and prior to that held senior executive positions with the company in Latin America and Australia.

Charlie is currently Chairman of the Advisory Board of the Sustainable Minerals Institute at the University of Queensland and Chairman of the Board of Wesley Medical Research Ltd. His previous roles included NonExecutive Director of OZ Minerals Limited, Chairman of the International Copper Association, a Member of the Department of Foreign Affairs and Trade's Council on Australian Latin American Relations and a Director of Xstrata Schweiz Limited. He also served as a

Page 3 of 113

2023 | Annual Financial Statements

ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

Non-Executive Director of Austin Engineering Limited, Goldcorp Inc., Newmont Corporation and as a two-term Member of the Senate of the University of Queensland. He was awarded an Honorary Doctorate in Engineering by the University of Queensland in 2019.

He is Chairman of the Sustainability and Innovation Committee, and member of the Audit and Risk Committee and Nomination Committee.

TONIANNE DWYER

B Juris (Hons), LLB (Hons), GAICD Independent Non-Executive Director Age 60

Tonianne Dwyer was appointed a Non-Executive Director of the Company on 1 July 2016. She has significant experience as a company director and executive working in finance, corporate strategy and mergers and acquisitions across a variety of sectors and international markets.

She is an internationally experienced independent company director, having had a 25-year executive career in investment banking during which she held roles with Hambros Bank Limited and Société General in the UK and Europe.

Tonianne currently holds a non-executive directorship role with Incitec Pivot Limited (appointed May 2022). She is Deputy Chancellor of the Senate of the University of Queensland and is on the Board of the Sir John Monash Foundation. Her previous roles included non-executive director positions with OZ Minerals Limited, DEXUS Property Group and DEXUS Wholesale Property Fund.

She is Chair of the People Committee and a member of the Sustainability and Innovation Committee and the Nomination Committee.

SIDDHARTHA KADIA

Ph.D. Biomedical Engineering,

B.E., Electronics

and Telecommunication Independent Non-Executive Director Age 53

Siddhartha Kadia was appointed a Non-Executive Director of the Company in January 2019. Siddhartha was formerly President and CEO of EAG Laboratories, a global scientific testing company headquartered in San Diego. He has also been a Director of USA-listed companies Newport Corporation (NSDQ: NEWP) and Volcano Corporation (NSDQ: VOLC). He is presently a Non-Executive Director of Nuvasive, Inc (appointed February 2022) and ATS (Applied Technical Services). He is the CEO and a Director of PhenomeX (NSDQ: CELL). Prior to EAG, Siddhartha served as President of the Life Sciences Division at Life Technologies Corporation (NSDQ: LIFE), a publicly traded Life Sciences tools company. Siddhartha was also a management consultant at McKinsey & Company where his work focused on

various life sciences and healthcare related engagements. Siddhartha has a PhD in Biomedical Engineering from Johns Hopkins School of Medicine. Siddhartha has lived and worked in the US, Japan, China and India and has more than 20 years of international experience as a company director, executive and technical leader in the Life Sciences and TIC (testing, inspection and certification) sectors.

He is a member of the Sustainability and Innovation Committee, the People Committee and the Nomination Committee.

LESLIE DESJARDINS

B. Industrial Admin, Finance (Kettering), MS. Business (MIT)

Independent Non-Executive Director Age 63

Leslie Desjardins was appointed a Non-Executive Director of the Company on 21 November 2019. She has a background as a CFO and senior financial and governance professional in a range of large multinational and global businesses.

She has extensive commercial and financial governance expertise with large multinational public companies in North America, Canada and Australia each with extensive global operations. Her areas of expertise include CFO level executive and financial strategic leadership, M&A, corporate finance and treasury, governance, financial and tax compliance and enterprise risk management.

Leslie is currently a Director, Audit Committee Chair, Human Resource Committee member with Ansell Limited. Previously, she served as a Board Director and Audit Committee member with AptarGroup.

During her executive career, Leslie served as Executive VP and CFO at Amcor Limited, a global leader in packaging of food, beverage, pharmaceutical and tobacco products. Prior to Amcor Ltd, Ms Desjardins served in financial and corporate strategic positions with General Motors Corporation, including Chief Financial Officer GM Holden Australia, Controller GM North America, Executive Director Manufacturing Finance and Director GM North America Strategy and Planning.

Leslie holds a Master of Science, Business with Massachusetts Institute of Technology, Sloan and a Bachelor of Industrial Administration, Finance with Kettering University.

She is the Chair of the Audit and Risk Committee and a member of the Nomination Committee.

2023 | Annual Financial Statements

Page 4 of 113

ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

PETER POSSEMIERS

Bachelor of Applied Science in Chemistry and Microbiology – University of South Australia Independent Non-Executive Director Age 62

Peter Possemiers was appointed a Non-Executive Director of the Company on 1 November 2022.

He has a background as a TIC sector expert with almost 40 years’ experience working as a Senior Executive in leadership roles globally for SGS. He has lead teams both regionally and globally most notably SGS’s global Environment Health and Safety business, a CHF 550million business with a global headcount which exceeded 6000. As Executive Vice President, he was a member of the SGS Operations Council with responsibility for the strategic growth and profitability of the business, leading 15 strategic acquisitions.

Peter’s career with SGS began following his completion of a degree in Microbiology and Chemistry at the University of South Australia. He quickly moved into management roles in Singapore, Philippines, China and in Korea where he established and developed new markets including food, pharma and mobile technology. In 2007 he was promoted to a role in Europe to manage the downstream OG&C business becoming the global market leader in this sector for SGS.

In 2013 Peter was promoted to EVP Global Environment, Health & Safety, a position based in Switzerland which he held for 8 years before moving into his most recent role as Vice President, Strategic Integration in 2021 following the acquisition of the Synlab A&S business which covered the Environmental, Food, Pharma and Oil Condition Monitoring testing sector across Europe.

He is a member of the Sustainability and Innovation Committee and the Nomination Committee.

COMPANY SECRETARY

MICHAEL PEARSON LLB, B A, GAICD, GCIS, Dip Inv Rel (AIRA)

Michael Pearson is a member of the Governance Institute, Australian Institute of Company Directors and Queensland Law Society. Mr Pearson is an experienced lawyer and corporate governance professional with almost 20 years of experience as a Company Secretary and General Counsel with other ASX listed companies such as Cardno Limited and the Aveo Group.

PRINCIPAL ACTIVITIES

The principal activities of the Group during the course of the financial year were the provision of professional technical services, primarily in the areas of testing, measurement and inspection, supporting:

environmental monitoring.
food and pharmaceutical quality assurance.
mining and mineral exploration.
commodity certification.
equipment maintenance; and
asset care operations.

During the year the Group expanded and diversified its technical service capabilities through various acquisitions. Refer note 5 of the Financial Statements.

Otherwise, there were no other significant changes in the nature of the activities of the Group during the year.

MALCOLM DEANE Bachelor of Laws (Masters) Juris Doctor Managing Director and Chief Executive Officer Age 39

Malcolm Deane was appointed as Interim CEO and Managing Director for ALS Limited on 7 March 2023. He was then appointed as the CEO and Managing Director with effect from 8 May 2023. Malcolm has served the company in various executive positions for the past 10 years in such roles as General Manager for Life Sciences Latin America, Food & Pharma Americas, and most recently as the Chief Strategy Officer, leading corporate strategy, business development and acquisitions.

Malcolm has a Master of Laws from the University of Virginia School of Law and Juris Doctor from Universidad Austral – Buenos Aires, Argentina

2023 | Annual Financial Statements

Page 5 of 113

ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

REVIEW OF RESULTS AND OPERATIONS

Group business summary

The Group aims to be a leading provider of services to clients across the broad range of industry sectors covered within the Principal Activities in the previous section and is committed to maintaining the strong and sustainable growth strategies which have made it a successful, global company. The Group seeks to build strong partnerships with clients by delivering costeffective solutions backed by the best quality, service, and technical capability.

The Group delivered another strong result for the financial year ending 31 March 2023 (FY23), with underlying[1] Net Profit After Tax (NPAT) exceeding the top-end of the upgraded guidance[2] . The results are reflective of the quality and diversity of the businesses and key-end markets in which the Group operates within. Despite a challenging environment with persistent and high inflation, geopolitical instability, labour challenges and difficult economic conditions in Europe, the Group has maintained its industry leading revenue growth and operating margins.

During the period, the Group was able to deliver margin improvement following successful inflation management across most businesses through price management initiatives, particularly within the Environmental and Geochemistry businesses. The Group disposed of its Asset Care business, which was non-core, delivering additional improvement to the overall margin performance.

The Group has continued to make highly strategic acquisitions, undertaking 13 acquisitions[3] , which are anticipated to contribute $115 million of revenue on a full year run rate. These acquisitions, coupled with the continued organic growth further improve the diversity of earnings from both a portfolio and regional approach.

The Group maintained a strong cash conversion of 97%, and improved returns on capital employed to 20.5%.

Sustainability for us at ALS means constantly improving the ways we work to have a positive impact on our people, our planet, and the communities we serve — and in doing so create long-term value and sustainable growth for our business. During FY23, the Board approved a roadmap for ALS to achieve Net Zero[4] by

Our roadmap will focus on reducing demand on resources, improving operational efficiency, investing in renewable energy, embedding sustainable procurement frameworks, enhancing efficiency of assets, and offsetting residual carbon where mitigation measures are not available. The Group is also committed to reducing Scope 1 and 2 emissions by 78% by 2030 (against the baseline FY20).

The Life Sciences division continued to grow, delivering solid organic revenue and material scope growth, despite the challenging environment in which it operated within. Underlying margins were impacted by macro factors such as geopolitical instability, difficult economic conditions in Europe, and restrictive monetary policy.

The Commodities division achieved strong revenue growth and underlying EBIT[1] margin expansion, benefitting from continued commodity demand, effective capacity planning and pricing outcomes.

The Group is confident that the quality of its assets, its operating model, and its disciplined strategic focus will see it continue to increase market share, deliver earnings growth and returns for shareholders.

FY27 vision

Following the successful completion of the previous 5- year strategy, the Group provided a new strategic vision that will continue the transformation of ALS into a market leader in the TIC industry.

The strategy consists of a series of strategic growth priorities, with an emphasis of investments to capitalise on industry megatrends linked to Sustainability and Life Sciences, as well as rebalancing the portfolio. The Group’s strong people focus, culture of innovation and collaboration will provide the necessary support to achieve the growth agenda. The financial targets set for FY27 include growing revenue to $3.3 billion, and growing underlying EBIT[1] to $0.6 billion, with a Group margin floor of 19%. In addition, the Group will aim to keep cash conversion above 90% and continue to improve the return on capital above 20%.

The Group has made excellent progress in FY23 towards achieving its FY27 objectives.

1 The terms ‘underlying’ and ‘EBIT’ are non-IFRS and unaudited

2 FY23 NPAT (including discontinued businesses) was $324.4 million, above guidance range of $312 to $322 million

3 3 acquisitions were executed after 31 March 2023

4 Net Zero target is to reduce absolute scope 1 and 2 emissions by 95% and scope 3 emissions by 90% by 2050 against a baseline of FY2020.

2023 | Annual Financial Statements

Page 6 of 113

ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

Financial performance

The Group’s financial performance for the year to 31 March 2023 is summarised as follows:

2023($m)	Underlying results (incl Nuvisan proportionately consolidated @ 49%)6 49% of Nuvisan’s Underlying results Nuvisan Equity Share of Profit incl in Statutory results (note 2i) Restructuring & other items6 Amortisation of intangibles6 Statutory result Continuing operations Discontinued operations7
Revenue	2,421.2 121.7 (142.0) - - - 2,400.9
EBITDA8 Depreciation & amortisation	648.0 11.8 (22.9) (2.9) (21.4) - 612.6 (157.3) (6.1) 14.8 - - (9.9) (158.5)
EBIT8 Net Interest expense Tax expense	490.7 5.7 (8.1) (2.9) (21.4) (9.9) 454.1 (43.8) (0.3) 0.6 - (2.1) - (45.6) (125.0) (1.6) 2.2 - 6.8 1.6 (116.0)
Non-controlling interests	321.9 3.8 (5.3) (2.9) (16.7) (8.3) 292.5 (1.3) - - - - - (1.3)
Net profit / (loss) after tax (NPAT)	320.6 3.8 (5.3) (2.9) (16.7) (8.3) 291.2
Basic EPS (cents) Diluted EPS (cents)	66.31 60.23 66.01 59.96

6 The terms ‘Underlying results’, ‘Restructuring & other Items’, and ‘Amortisation of intangibles’ are non-IFRS disclosures. These terms have been presented to assist in the assessment of the relative performance of the Group from period to period. The calculations thereof are based on non-IFRS information and are unaudited. Refer to table on next page for details of restructuring & other items.

7 In February 2023 the Group sold its Australian Asset Care business. Refer note 1e.

8 EBITDA = EBIT plus depreciation and amortisation. EBIT = Earnings before interest and tax. The terms EBITDA and EBIT are non-IFRS disclosures. These have been presented to provide a measure of the Group’s performance before the impact of depreciation and amortisation (i.e., non-cash items) as well as that of interest and tax expenses. The calculations thereof are based on non-IFRS information and are unaudited.

2023 | Annual Financial Statements

Page 7 of 113

ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

Financial performance

The Group’s financial performance for the year to 31 March 2022 is summarised as follows:

2022($m)	Underlying results (incl Nuvisan proportionately consolidated @ 49%)9 49% of Nuvisan’s Underlying results Nuvisan Equity Share of Profit incl in Statutory results (note 2i) Restructuring & other items9 COVID-19 Subsidies & Grants10 net of Direct Costs9 Amortisation of intangibles9 Statutory result Continuing operations Discontinued operations11
Revenue	2,025.6 141.3 (73.8) - - - - 2,093.1
EBITDA12 FX losses transferred from FCTR Depreciation & amortisation	533.0 14.2 (19.1) 4.9 (22.4) (23.4) - 487.2 - - - - (26.9) - - (26.9) (130.2) (7.6) 8.5 - - - (9.6) (138.9)
EBIT12 Net Interest expense Tax expense	402.8 6.6 (10.6) 4.9 (49.3) (23.4) (9.6) 321.4 (37.4) (0.5) 0.2 - (1.3) - - (39.0) (103.8) (1.8) 2.0 - 5.9 6.3 1.2 (90.2)
Non-controlling interests	261.6 4.3 (8.4) 4.9 (44.7) (17.1) (8.4) 192.2 (1.7) - - - - - - (1.7)
Net profit / (loss) after tax (NPAT)	259.9 4.3 (8.4) 4.9 (44.7) (17.1) (8.4) 190.5
Basic EPS (cents) Diluted EPS (cents)	53.82 39.45 53.57 39.26

9 The terms ‘Underlying results’, ‘Restructuring & other Items’, ‘COVID-19 Subsidies & Grants net of Direct Costs’ and ‘Amortisation of intangibles’ are non-IFRS disclosures. These terms have been presented to assist in the assessment of the relative performance of the Group from period to period. The calculations thereof are based on non-IFRS information and are unaudited. Refer to table on next page for details of restructuring & other items.

10 As disclosed in the FY 21 results, the Group made the decision to repay government grants and subsidies received as part of the COVID-19 pandemic response in Australia under the JobKeeper scheme and in Canada under the Canada Emergency Wage Subsidy (CEWS) programme. During FY 22 the Group repaid and expensed to the profit and loss account net JobKeeper of $3.0 million and net CEWS of $20.4 million, after deducting costs associated with the repayment.

11 In February 2023 the Group sold its Australian Asset Care business. Refer note 1e.

12 EBITDA = EBIT plus depreciation and amortisation. EBIT = Earnings before interest and tax. The terms EBITDA and EBIT are non-IFRS disclosures. These have been presented to provide a measure of the Group’s performance before the impact of depreciation and amortisation (i.e., non-cash items) as well as that of interest and tax expenses. The calculations thereof are based on non-IFRS information and are unaudited.

2023 | Annual Financial Statements

Page 8 of 113

ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

Financial performance (continued)

The Group achieved revenue from continuing operations of $2,421.2 million, up 19.5% compared to $2,025.6 million recorded in the prior corresponding period (pcp). Organic revenue growth contributed 10.8% to the uplift, with acquisition growth contributing 7.5%, and a positive FX impact of 1.3% due to depreciation of the Australian dollar against main currencies during FY23. The revenue growth was primarily driven by our core Environmental business within the Life Sciences division, and Geochemistry and Metallurgy within the Commodities division.

Despite the challenging environment in FY23, the Group delivered an underlying EBIT[13] margin of 20.3%, an improvement of 38 basis points (bps) compared to the pcp. The improved underlying EBIT margin was driven by a combination of price management and value-added services, efficiency gains on invested capital, improved procurement practices and portfolio rationalisation.

The Group delivered a full-year statutory NPAT of $291.2 million, compared to the $190.5 million recorded in the pcp. The increase of $100.7 million in NPAT reported in FY23 is primarily due to the net effect of businesses’ strong underlying results, reduced oneoff costs and net gains from the sale of Asset Care business.

On an underlying basis, the Group recorded NPAT of $320.6 million, up 23.4% compared to $259.9 million reported in the pcp, another strong outcome despite inflation headwinds, geopolitical conflicts, challenging economic conditions within Europe, and labour sourcing shortages.

The Group delivered strong net free cash flows (before capex spend) of $550.5 million, an increase of $109.7 million compared to the pcp. 97% of underlying EBITDA was converted to cash in the period, an increase of 4% from the pcp driven by continued execution of the working capital improvement plan.

The Group’s overall operational capital expenditure increased in FY23 by $27.2 million to $146.1 million compared to pcp, with spending targeted on key growth opportunities in Life Sciences and Commodities. The capex-to-revenue ratio was 6.0% in FY23 of which 4.0% was linked to growth capex and 2.0% for maintenance capex. The majority of the capex was

focused on growth initiatives across both divisions.

On 16th February 2023, it was announced to the ASX that the Company had signed an agreement to divest its Australian Asset Care business to SRG Global. The completion of this transaction occurred effective 28 February 2023. The Australian Asset Care business is reported as discontinued operations and the prior year comparatives have been updated to reflect this treatment. The Asset Care business formed a large component of the Industrial Segment prior to its divestment. The Industrial Segment comprised of the Tribology business (retained and reported as part of the Commodities segment) and the Asset Care business (now divested). As such, as of 31 March the ALS Group has only two reportable operating segments: Life Sciences and Commodities.

The Group leverage ratio was at 1.8 times as at 31 March 2023 (31 March 2022: 1.9 times) with available liquidity of $422.5 million, including $336.0 million of undrawn bank facilities. The existing $128 million debt facility maturing in October 2023 is to be refinanced in 2023. In May 2023, the Group secured an additional $149.3 million (US$100 million) bank facility which eliminates any potential refinance risk and increases liquidity to $571.8 million. The strong balance sheet and overall liquidity is available to support the Group’s ambitious growth agenda to capitalise on megatrends linked to both sustainability and Life Sciences.

Based on the strong performance delivered by the Group and its strong balance sheet as of March 2023, the Directors have declared a partly franked final dividend for the year of 19.4 cents per share, 10% partially franked (2022 final dividend: 17.0 cents per share, 30% franked). Together with the interim dividend of 20.3 cents per share (0% franked), the total partly franked dividend for the year will be 39.7 cents per share, up 21.0% on the pcp (2022: 32.8 cents), representing a combined dividend payout ratio of 60% of underlying NPAT, at the top end of the reference range (50 – 60% of underlying NPAT). The dividends will be paid on 6 July 2023 on all shares registered in the Company’s register at the close of business on 13 June 2023. The existing $100 million share buy-back program remains active and as such, the Board has determined not to activate the dividend reinvestment plan (DRP) at this time.

13 The terms ‘underlying’ and ‘EBIT’ are non-IFRS and unaudited

2023 | Annual Financial Statements

Page 9 of 113

ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

Restructuring & Other items	2023 ($m) 2022 ($m)
Greenfield start-up cost Acquisition costs Impairment of right-of-use asset and other site closures SaaS system development Profit on sale of Asset Care FX losses transferred from FCTR as part of an internal corporate loan restructure Other, including employee redundancy costs	3.9 2.5 7.3 8.0 3.7 2.2 12.5 1.9 (12.3) - - 26.9 6.3 7.8
	21.4 49.3

Divisional reviews

2023 performance

Life Sciences Non-
Statutory - Financial performance (incl	2023 ($m)	2022 ($m)	Variance
Nuvisan)14
Revenue	1,334.1	1,139.1	17.1%
Segment EBIT15	196.5	181.5
Restructuring and other items15	10.4	13.3
Underlying segment EBIT15	206.9	194.8	6.2%
Margin (underlying segment EBIT to revenue)	15.5%	17.1%
Underlying segment EBITDA15	302.9	276.5	9.6%
Margin (underlying
segment EBITDA to	22.7%	24.3%
revenue)

The Group has two reportable operating segments as of 31 March 2023: Life Sciences and Commodities.

Life Sciences

Value proposition

The Life Sciences division provides analytical testing and sampling services and remote monitoring for the Environmental, Food, Pharmaceutical, and Consumer Product markets. It is a leader in global comprehensive analytical testing, demonstrating expertise in microbiological, physical, and chemical testing services.

Life Sciences is focused on continuing to deliver strong revenue growth across Environmental, Pharmaceutical and Food business.

The Life Sciences division continued its growth momentum, posting modest organic revenue growth of 5.2% and delivering scope growth of 10.7% mainly driven by strategic acquisitions in Food and Pharmaceutical businesses. The growth was achieved despite difficult economic conditions, particularly within Europe.

The division delivered an underlying EBIT margin of 15.5% in FY23, which was a contraction of 159 bps compared to the pcp. This was a result of global economic uncertainty, particularly in Europe, and restrictive monetary policy impacting food volumes and new drug development. As anticipated and budgeted at the time, some of the large acquisitions contributed to the overall dilution of margins within the division. Excluding the impact of Nuvisan, the underlying Life Sciences margin was 16.7%, a contraction of 61 bps compared to the pcp. This performance reflects the resilience and strength of the underlying business, particularly the scale and operational leverage of the market leading and global Environmental business.

The Environmental business delivered strong growth across all regions, achieving organic revenue growth of 7.0%. The business was able to successfully improve margins by 52 bps through enacting price point increases, particularly in Europe, and leveraged its large global footprint and scale.

14 Life Sciences underlying results plus 49% of Nuvisan’s revenue and expenses (non IFRS).

15 EBIT = Earnings before interest and tax. EBITDA = EBIT plus depreciation and amortisation. The terms EBIT, EBITDA, Restructuring and other items, and Underlying segment EBIT/EBITDA are non-IFRS disclosures. These terms have been

presented to provide a measure of the Group’s performance before the impact of depreciation and amortisation (i.e., non-cash items) as well as that of interest and tax expenses. The calculations thereof are based on non-IFRS information and are unaudited.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

The Food business posted a small organic revenue growth of 1.5%, with growth achieved in APAC but offset against flat volumes in all other regions. The UK and European markets were impacted by geopolitical disruptions and economic uncertainty.

The Pharmaceutical business delivered organic revenue growth of 3.4%, with double-digit and high-single digit organic growth in APAC and Americas. Nuvisan was impacted by geopolitical instability and macro uncertainty limiting spend on new drug development activities.

The Group will continue to partner and work with Nuvisan (as a 49% minority shareholder) to improve the underlying profitability of the business through an agreed margin improvement plan into FY24. The underlying performance in the other pharmaceutical businesses performed well during the period.

Medium to Long Term Outlook

The Life Sciences portfolio remains well supported by sustainable global market segments, underpinned by industry megatrends such as increased regulation and outsourcing trends. The Environmental business is well positioned as a market leader to capitalise on emerging contaminants, such as PFAS, following increased regulatory legislation across the globe.

The Food and Pharmaceutical businesses have low market shares in highly fragmented markets, with the size and scale of the global pharmaceutical market presenting significant growth opportunities. Growth will be achieved both organically and through strategic acquisitions that expand existing service offerings and overall geographic footprint.

Commodities

Value proposition

The Commodities division is a leading full-service provider of testing services for the global mining industry across six key business streams – Geochemistry, Metallurgy, Consulting, Inspection, Tribology and Coal Quality. These businesses provide a broad coverage to an extensive client base of explorers, miners, and traders. The Commodities division includes the Tribology business following the sale of Asset Care in March 2023.

The Commodities focused businesses provide testing and consulting services over the entire resource lifecycle from exploration, feasibility, optimisation, production, design, development through to trade and rehabilitation. The division’s strategy is to ensure all its business streams are equipped with the technical expertise and operational capacity required to provide its clients with a suite of integrated services throughout market cycles.

The Tribology business has an international client base in the mining, transportation, construction, agriculture and energy sectors.

2023 performance

Commodities - Financial performance	2023 ($m)	2022 ($m)	Variance
Revenue	1,087.1	886.5	22.6%
Segment EBIT16	329.6	243.3
Restructuring and other items16	0.4	12.1
Underlying segment EBIT16	330.0	255.4	29.3%
Margin (underlying segment EBIT to revenue)	30.4%	28.8%
Underlying segment EBITDA16	390.3	302.8	28.9%
Margin (underlying
segment EBITDA to	35.9%	34.2%
revenue)

The Commodities division closed the year with a robust organic revenue growth of 18.0% as it benefitted from capacity growth, price management and supportive base metals demand.

The division delivered an underlying EBIT margin of 30.4%, an increase of 155 bps vs pcp, which was a result of strong operational performances across the Geochemistry and Metallurgy business.

The Geochemistry business generated organic revenue growth of 20.0%, with growth achieved in all regions, supported by increasing demand for base metals, particularly those linked to future clean energy technologies. The business was able to effectively manage capacity throughout the period with good price discipline and increase the uptake of premium analytical services. The recent acquisition of Goldspot Technologies, which continues its journey into innovation, is resulting in increased interest in consulting activities from global mining clients.

Metallurgy grew organic revenue by 28.3% driven by the strong mining sector activity in energy and battery related metals, with support by strong commodity prices from traditional revenue sources. The pipeline of projects remains high.

The Inspection business posted an organic revenue improvement of 11.5% due to strong global commodity trading activities. Despite global economic pressures and the continued impact of COVID-19 disruption in Asia, the business managed costs well. It remains focused on global growth of commodity inspection and testing services.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

The Coal business closed the year with 3.6% organic growth, with a minor EBIT margin contraction. The division continues to provide specialist technical expertise to the coal industry and will focus on operational efficiencies and revenue growth.

The Tribology business had organic revenue of 7.5% with key regions such as Australasia, North America and Latin America performing well. The business was impacted by labour sourcing shortages, increased operating costs, but margins improved significantly in the last quarter.

Medium to Long Term Outlook

The Geochemistry business is the largest provider of analytical services to the global mining industry and has demonstrated its ability to grow both market share and capacity over the years. The business has maintained the largest market share in the industry due to its superior execution, testing capabilities, geographical footprint and available capacity.

The future profitability of this business is expected to be supported by 1) a continued level of base metal demand required for clean energy transition, 2) increased level of demand for premium analytical services, 3) an agile cost base and capacity planning tools, and 4) its strategic shift into more downstream activities including new innovation & data analytics.

Discontinued operations (Asset Care)

On the 16[th] of February 2023, it was announced to the ASX that the Company had signed an agreement to divest its Australian Asset Care business to SRG Global. The completion of this transaction occurred effective 28 February 2023. The Australian Asset Care business is reported as discontinued operations and the prior year comparatives have been updated to reflect this treatment. The Asset Care business formed a large component of the Industrial Segment prior to its divestment. The Industrial Segment comprised of the Tribology business (retained and reported as part of the Commodities segment) and the Asset Care business (now divested).

16 EBIT = Earnings before interest and tax. EBITDA = EBIT plus depreciation and amortisation. The terms EBIT, EBITDA, Restructuring and other items, and Underlying segment EBIT/EBITDA are non-IFRS disclosures. These terms have been presented to provide a measure of the Group’s performance

Asset Care - Financial	2023	2022
performance	($m)	($m)
Revenue	121.7	141.3
Segment EBIT16	5.6	2.9
Restructuring and other items16	-	3.7
Underlying segment EBIT16	5.6	6.6
Margin (underlying
segment EBIT to	4.6%	4.7%
revenue)
Underlying segment EBITDA16	11.8	14.2
Margin (underlying
segment EBITDA to	9.7%	10.1%
revenue)

DIVIDENDS

Dividends paid or declared by the Company since the end of the previous financial year are:

Cents per share Franked amount (cents) Total $m	Cents per share Franked amount (cents) Total $m
Ordinary dividends declared and paid during the year:
Final 2022, paid 4 Jul 2022 17.0 5.1 Interim 2023, paid 16 Dec 2022 20.3 - Total amount	82.2 98.3
	180.5
Ordinary dividend declared after the end of the financial year:
Final 2023, to be paid 6 Jul 2023 19.4 1.9 93.9

The financial effect of the Final 2023 dividend does not impact the financial statements for the year ended 31 March 2023 and will be recognised in subsequent financial reports. The franked components of all dividends paid or declared since the end of the previous financial year were franked based on a tax rate of 30.0%.

before the impact of depreciation and amortisation (i.e., noncash items) as well as that of interest and tax expenses. The calculations thereof are based on non-IFRS information and are unaudited.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

DEBT PROFILE

The Group’s policy of ensuring a diversity of funding sources and maturities is a key element of its management of refinancing and liquidity risks and is reflected in the following table:

In millions of AUD
Source Maturity	Drawn Facility Limit
Bank facilities EUR Oct 2023 Bank facilities USD May 2024 Bank facilities EUR Sep 2024 Bank facilities USD May 2026 Local facilities Various US Private Placement Market Nov 2030 US Private Placement Market Jul 2032 US Private Placement Market Jul 2034	128.3 128.3 85.0 298.6 50.3 50.3 101.5 223.9 5.5 5.5 285.3 285.3 292.1 292.1 254.6 254.6
	1,202.6 1,538.6

The Group is party to multi-currency, revolving multicurrency debt facility agreements with six banks totalling USD$350 million, and separate bullet maturity EUR110 million bank facilities.

The Group has also successfully issued long-term US Private Placement (USPP) senior notes with long-dated maturities in each of November 2030, July 2032 and July 2034 respectively. These long-term notes are fixed rate and issued in a mix of AUD, USD, EUR, CAD and GBP currencies to permit the Group’s global cash flows and operating assets mix to be appropriately balanced by funding in similarly denominated debt. The weighted average interest rate attaching to all group borrowings as at 31 March 2023 is 3.3%.

Since 31 March 2023, the Group has entered into new additional bilateral revolving bank facilities totalling USD100 million (AUD149.3 million) which have been finalised in May 2023 (refer to note 7e). Following the availability of this new facility, liquidity available to the Group increases to a revised total of AUD574 million, and the proforma weighted average debt maturity for the Group is expected to be 5.3 years.

FINANCIAL POSITION

The major changes in the Group’s financial position during the year (refer to summarised balance sheet below) were the result of:

an increase in external loans and borrowings totalling $178.2 million, to fund investments in new business acquisitions and CAPEX, to generate strong levels of organic growth; and
total dividend payments to shareholders and minority interests of $181.9 million.

The summary effect during the reporting period was:

an increase in net debt (excluding lease liabilities) of $121.4 million; and
an increase in intangible assets of $219.1 million; and
total equity increased by a net $247.5 million.

The Group remains committed to its strategy of maintaining a strong balance sheet throughout economic cycles as evidenced by book gearing of 42.6% (2022: 44.4%) and leverage of 1.8 times (2022: 1.9 times) as noted in the following table:

The Group maintains over $422.5 million available liquidity, 16.4x interest coverage and weighted average debt maturity of 5.8 years as at 31 March 2023.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

		In millions of AUD	Consolidated	Consolidated
In millions of AUD Consolidated			2023	2022
Note 2023*	2022	Underlying operating EBIT17	496.4	409.4
Trade and other receivables 2a 416.6	386.6	Depreciation & amortisation	163.4	137.8
Inventories 2c 101.3	71.2	Amortisation on ROU	(68.3)	(53.4)
Other current assets 2h 55.8	61.3	Interest on ROU	(8.0)	(7.3)
Trade and other payables 2d (346.3)	(310.8)	Underlying EBITDA17(pre- IFRS16 basis)	583.5	486.5
Total working capital 227.4	208.3	Nuvisan Underlying EBITDA17
		adjusted for ROU Lease
Cash and cash equivalents 3a 179.6 Loans and borrowings (excluding leases) 3d (1,202.6) Net debt (1,023.0)	122.8 (1,024.4) (901.6)	Assets and net of dividends received Working capital	(14.3) 569.2 (31.2)	(12.7) 473.8 (37.7)
		Other	12.5	4.7
Property, plant and equipment 2e 580.8	494.6	Cash flow before CAPEX	550.5	440.8
Right-of-use assets 231.7	198.8	Cash Conversion	97%	93%
Intangible assets 2g 1,413.9	1,194.8	Cash flow before CAPEX	550.5	440.8
Net deferred tax assets 6b 1.8	15.6	One-offs (cash basis)	(18.0)	(45.6)
Investments 283.7	240.9	ROU Payments	60.4	52.3
Other assets 42.4	31.4	Treasury Shares	(7.2)	(11.0)
Employee benefits (66.3)	(75.2)	Other	(12.5)	(4.6)
Other liabilities (68.6)	(63.7)	Cash generated from	573.2	431.9
Lease liabilities (245.6)	(213.2)	operations
2,173.8 Net assets 1,378.2	1,824.0 1,130.7	Net Interest & Taxes Paid Net cash from operating activities	(133.3) 439.9	(145.1) 286.8
Total equity 1,378.2 Gearing: Net debt to Net debt + Equity 42.6% * References are to Notes to the Financial Statements	1,130.7 44.4%	Net cash from investing activities Net cash from financing activities	(267.0) (121.2)	(405.9) 77.4
CASH FLOW		Net movement in cash and cash equivalents	51.7	(41.7)
Cash conversion measured as cash generated from operations (before interest and taxes paid) vs Underlying EBITDA17was 97%. Underlying EBITDA17		Cash and cash equivalents at 1 April Effect of exchange rate fluctuations on cash held	122.8 5.1	168.6 (4.1)
times interest cover was 16.4 times (2022: 15.3 times). Capital expenditure of $146.1 million, acquisitions		Cash and cash equivalents at 31 March	179.6	122.8
expenditures totalling $232.2 million, and dividends paid to shareholders and minority interests of		*Leverage:*Net debt to _Underlying EBITDA_17	1.8 times	1.9 times
$176.6 million, offset by divestment proceeds of $98.9 million, drove investing and financing outflows during FY23.		*Interest cover:*Underlying EBITDA_17_to Net finance expense (loans & borrowings)	16.4	15.3

Capital expenditure of $146.1 million, acquisitions expenditures totalling $232.2 million, and dividends paid to shareholders and minority interests of $176.6 million, offset by divestment proceeds of $98.9 million, drove investing and financing outflows during FY23.

17 Underlying EBIT = Earnings before interest and tax. Underlying EBITDA = Underlying earnings before interest, tax, depreciation, and amortisation. The calculation of Underlying EBIT and

EBITDA is non-IFRS and unaudited.

2023 | Annual Financial Statements

Page 14 of 113

ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

MATERIAL BUSINESS RISKS

Material Business Risk Statement

ALS recognises that the effective management of risks is a fundamental component of good corporate governance and is vital for the company’s continued growth and success. ALS is committed to enterprisewide risk management to ensure its corporate governance responsibilities are met and its strategic goals are realised.

Our Board Audit and Risk Committee assists the Board in discharging its responsibilities to exercise due care, diligence and skill in relation to risk management and internal control systems. Our Sustainability and Risk function is responsible for the design of our Risk Management Framework and for supporting the implementation of the framework across the organisation.

Our risk management approach is aligned with ISO 31000:2018 Risk Management – Guidelines and facilitates a consistent and comprehensive approach to our identification, assessment, response, and communication of risks. Our Risk Management Policy allocates responsibilities and accountabilities across all levels of the Group to maintain a culture of empowered and risk-aware decision-making in line with our risk appetite.

Material Business Risks (MBRs)

Our MBRs are enterprise-wide risks that could materially impact our ability to achieve our Group strategic objectives, performance targets, financial results or damage our brand and reputation.

During the year, our annual materiality assessment validated existing MBRs and identified emerging enterprise-wide risks. Our controls assurance matrix was reviewed to ensure it captured the processes utilised to measure and monitor each risk. All MBRs were reported to the Audit and Risk Committee and the Board, with deep dives undertaken on selected MBRs.

Twenty-eight MBRs were recorded in our Group Risk Register and evaluated in the context of the likelihood of occurrence and the potential threat and opportunity they pose. These MBRs are categorised as either climate and environment, corporate affairs and social performance, financial management, growth and transformation, legal and compliance, operations, people, or innovation & technology.

Climate and environment

The MBR of climate change and ESG disclosures received significant attention during the year. The widespread economic and social consequences of climate change present both risks and opportunities affecting our business and the communities in which we operate through cost impacts and operational efficiency disruptions. We continued to monitor the evolving sustainability reporting landscape and impending changes in international jurisdictions. Further information regarding our efforts is outlined within our Annual Sustainability Report, available on our website. Possible impacts noted from a failure to appropriately manage this MBR included infrastructure damage; damage to brand and reputation; and increased energy costs. Our main mitigation measures included energy and waste savings initiatives; management of (and reduction in) GHG emissions; obtaining limited assurance of our Sustainability Report; and updating our Climate Change Strategic Plan.

Our climate and environment MBRs also focused on natural disasters, including physical risk impacts and environmental management, including natural resources efficiency and biodiversity.

Corporate affairs and social performance

Safeguarding our brand and reputation remained a core focus. As a market leader in testing and inspection services, maintaining an exceptional reputation is central to our continued growth and meeting stakeholder expectations. Possible impacts noted from a failure to safeguard our brand and reputation included loss of clients and market share; share price deterioration; challenges in raising equity; and increased employee turnover. Our main mitigation measures identified to protect and enhance our brand and reputation included continued promotion of the principles and expected standards of behaviour set out in our Code of Conduct; client, community and employee engagement initiatives and feedback; monitoring interactions with our social media platforms; active participation with global ESG ratings agencies to benchmark our approach; and robust quality control measures, including third party accreditation where available. External partner risk, including the failure to uphold human rights, was also captured as a MBR.

2023 | Annual Financial Statements

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

Financial management

Political unrest remained a focus during the year given the impacts flowing from evolving economic and geopolitical headwinds threatening the industries and environments in which we operate. Common threats associated with political unrest include trade wars, sanctions and embargoes and other similar impacts and restrictions which reinforce the need to maintain corporate resilience amidst the volatile global trade landscape. Possible impacts noted as arising from a failure to manage political unrest include disruption in the provision of services; loss of assets; and closure of sites. Main mitigation measures in place included business continuity plans; local employment; regular liaison with community members and businesses; external security monitoring service advice on country political risk; regular audits of asset values in high-risk locations and minimisation of assets in at-risk locations; and periodic cash repatriation.

Treasury management aimed at addressing our exposure to liquidity risk, interest rate risk, foreign exchange risk, and credit risk (counterparty exposure), also remained a focus during the year. Possible impacts noted as arising from a failure to manage this MBR included an inability to pay debts; funding being unavailable for investments or acquisitions; and financial loss. Main mitigation measures captured included compliance with established financial risk and cash management policies; monitoring of debt levels and cash flow; holding of liquidity reserves and agreed minimum financial ratios; monitoring of interest expenses; use of hedging and leverage strategies; and monitoring of counterparty exposure.

Management of debtors and taxation management also continued to be a focus of our financial management MBRs.

Growth and transformation

Our commodities business operates in a cyclical resources sector, reinforcing the effect that changes in commodity prices can have on our business. We continued to recognise the importance of balancing the potential threats and opportunities presented by commodity market cycles and we championed an adaptive business model that allows for scalability of services, a disciplined focus on operational costs, and close monitoring of economic trends to assist in managing this MBR. A possible impact noted as arising from a failure to appropriately manage changes in commodity prices included financial losses from a decline in sample flows. Our main mitigation measures captured included a diverse testing and inspection service offering across a range of industry sectors and geographies; continual monitoring of global commodity prices and economic trends; open and transparent client communications, including those in response to significant price fluctuations; and scaling of operations to meet demand and turnaround time.

New business development also remained a focus area in order for us to adapt and thrive within a constantly evolving competitive landscape. Possible impacts noted in failing to respond to new business development included loss of market share to competitors; decreasing productivity and efficiency; reduced margins and profits; and the inability to compete and continue to operate. Main mitigation measures noted included collaborative cross-business and functional teams to identify enhancements to existing service offerings and contemporary or novel opportunities (including potential acquisitions), and a renewed focus on strategic partnerships.

Our growth and transformation MBRs also included a focus on the management of mergers and acquisitions and the implementation of our new enterprise resource planning software system.

2023 | Annual Financial Statements

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

Legal and compliance

Given the numerous legal and regulatory frameworks we are subject to as a consequence of our geographical spread, regulatory compliance (including that relating to bribery and corruption, trade and economic sanctions, and privacy and data protection) continued to be a focus in reviewing our MBRs. Given the worldwide increasing focus on privacy and data protection, this risk area became its own MBR alongside regulatory compliance. Specific programs aimed at raising awareness of our legal and regulatory compliance obligations (including that relating to privacy and data protection) and the controls needing to be adhered to, continued to be documented in enterprise-wide policies that are periodically reviewed and updated as required. Ongoing supplementary online and in-person training and annual compliance signoffs from relevant managers across the Group as to adherence with obligations remained in place.

Possible impacts noted from a failure to manage our legal and regulatory compliance obligations include notification to, and investigation and prosecution by, regulators; loss of clients; financial penalties; loss of confidential information; loss and misuse of personal information; loss of accreditation; adverse media coverage; damage to brand and reputation; continuing disclosure of prosecutions or penalties in future tender responses; and the inability to retain employees and attract new talent. Our main mitigation measures included established monthly reporting processes; annual compliance signoffs by relevant managers; notification processes for updates on emerging legal and regulatory compliance obligations; internal audit activities; and training courses, including targeted education and awareness sessions.

Our legal and compliance MBRs also included a focus on mitigating fraud and compliance with ASX listing and operating rules.

Operations

As a global leader in scientific analysis and testing, quality management and data integrity are at the core of the services we provide. Our Code of Conduct demonstrates our commitments to ethical conduct and impartiality as to quality and data integrity. Possible impacts noted from a failure to appropriately manage this MBR include potential legal proceedings for incorrect testing or the provision of incorrect results; damage to brand and reputation; adverse media coverage; regulatory inquiry and investigation; a loss of accreditation; increased insurance premiums; erosion of share price; and a decline in ESG ratings. Our main mitigation measures included documented policies and procedures covering quality management controls; laboratory quality accreditations; laboratory information management systems; and quality control team collaboration.

Health and safety management remained a focus area given the safety risks inherent in our Group operations. We championed a culture of a shared commitment to, and accountability for, the safety and wellbeing of our employees, contractors, and the communities in which we operate. Possible impacts noted from a failure to appropriately manage this MBR included harm caused to employees; increased regulatory investigation and prosecution; financial penalties; loss of ISO certification; and damage to brand and reputation. Our main mitigation measures captured included documented policies and standards covering health and safety risks; the appointment of specialised HSE personnel; international travel risk security advisory service; site safety risk assessments; compliance signoffs; audit activities; mandatory HSE training.

Our continued focus on procurement and supply chain was driven by the need for agile responses to fluctuating macroeconomic factors, including complex logistics restrictions, labour and materials shortages, and the inflation and deflation cycles disrupting industries and sectors within which we operate. Possible impacts noted from a failure to appropriately manage this MBR included disruptions to the provision of services leading to a loss of clients and future work. Our main mitigation measures captured included business continuity plans, including supplier integrity reviews and redundancy planning for critical business supplies; and the provision of alternative utilities or equipment where required.

Our Operations MBRs also included a focus on the management of client and third-party contracts and fire prevention.

2023 | Annual Financial Statements

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

People

People capabilities and retention of talent remained a focus area as we continued our efforts to widen our talent pool by attracting and retaining people in key roles who possess skills and experience that enabled us to leverage growth opportunities. Possible impacts noted from a failure to manage this MBR included insufficient expertise to deliver our 5-year strategic plan; sub-standard quality in service delivery; a lack of a diverse workforce; a diminished sense of employee wellbeing; loss of corporate knowledge; and a decline in ESG ratings. Our main mitigation measures included benchmarked remuneration strategies; talent assessments; leadership training and employee development plans; and employee engagement and benefit strategies.

Our People MBRs also included a focus on continuing to foster a workplace culture and conduct that is safe, inclusive, and provides an enriched setting to cultivate innovation and new ideas. Possible impacts noted from a failure to manage this MBR included the emergence of undesirable and non-inclusive sub-cultures; demotivated employees; increased turnover; erosion of brand and reputation; and a decline in ESG ratings. Our main mitigation measures captured included continued promotion of the principles and expected standards of behaviour set out in our Code of Conduct; Diversity, Equity and Inclusion initiatives and programs; inclusive leadership development and training; employee engagement survey; pre-employment screening; and a confidential and anonymous whistleblowing helpline.

Innovation & technology

Innovation remained a critical strategic focus area as we sought progressive and dynamic value-add solutions for the business challenges faced by us and our stakeholders. Possible impacts noted from a failure to appropriately manage this MBR included a loss of market share; deceased efficiency and productivity; reduced margins and profits; the inability to compete and continue strategic competitive partnerships; reduced employee engagement and increased turnover; and brand dilution. Our main mitigation measures captured included standardised idea generation software and process workflows; enhanced monitoring of patent and copyright protections; and employee incentives for ideas generation.

Our innovation and technology MBRs included a focus on our information and operational technology digital assets, including enhancing the integrity and functionality of these assets, strengthening business continuity, and incident response controls. Our Cybersecurity MBR focused on acknowledging the Group’s reliance on IT&OT and our heightened risk exposure amidst the constantly evolving cybersecurity threat landscape. Possible impacts noted from a failure to appropriately manage these MBRs included disrupted service delivery; reduced workforce productivity; loss of clients; loss and misuse of confidential information; data breach notification and regulatory investigation and enforcement action; adverse media coverage; erosion of brand and reputation and share price; and a decline in ESG ratings. Our main mitigation measures included mandatory cybersecurity awareness training; and documented information technology policies covering security measures, incident response and business continuity.

TASK FORCE ON CLIMATERELATED FINANCIAL DISCLOSURES (TCFD)

ALS are committed to mitigating the impact we have on climate change by reducing our absolute carbon emissions through programs of work completed under the remit of our Net Zero plan. We support the voluntary disclosure recommendations established by the TCFD and consider these disclosures to be an important hallmark of overall environmental, social and governance transparency. Having regard to developments across the international regulatory and sustainability reporting landscape, we are committed to continuously improving the context and calibre of our climate related strategy, targets and performance disclosures.

As a leading provider of analytical testing services, we recognise the strength of our position to help build a sustainable future for all by delivering innovative scientific solutions to meet sustainability challenges. At ALS, tapping into these opportunities not only makes good business sense, but empowers us to contribute to a healthier and safer future for all.

2023 | Annual Financial Statements

Page 18 of 113

ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

Governance

The Board’s role

Governance of climate change is the responsibility of the Board which oversees the response to climate change risks and opportunities through the Board subcommittees including the Sustainability and Innovation Committee, the Audit and Risk Committee, and People Committee.

Sustainability and Innovation Committee The purpose of the Sustainability and Innovation Committee is to provide oversight, on behalf of the Board, of the strategies, standards, processes and practices intended to effectively manage environment, society and governance performance risks. Specifically, the Committee is to:

Consider the social, environmental, and ethical impact of the Group’s activities.
Assess and recommend to the Board, the approval of the annual Sustainability Report.
Review and recommend to the Board, the approval of the Group Climate Change Strategic Plan. Monitor the progress of business stream specific plans against the Group Climate Change Strategic Plan.
Review and recommend to the Board for approval, the Group’s short, medium, and long-term emissions targets, and goals.
Review the company’s performance against its sustainability scorecard including specific carbon intensity targets.

Audit and Risk Committee

The Audit and Risk Committee provides oversight over the Group’s risk profile, policies, and management, including the key strategic and financial risks identified during the annual material business risk review process. Climate change is treated as a material business risk and its related risks and opportunities are incorporated into ALS’s broader corporate strategy, planning, and risk management.

The Committee is responsible for:

Reviewing estimates and judgements needed to apply to key accounting standards including valuations, impairments and depreciation rates for assets that may be impacted by climate change.
Reviewing the business strategy and the impact on the financial planning process by using climaterelated scenario analysis. Key impacts to consider include operating costs and revenues, capital expenditures and capital allocation, acquisitions or divestments, and access to capital.
Reviewing the company’s disclosure requirements specific to the impact of climate change on the company’s financial statements, including oversight of TCFD reporting.

People Committee

The People Committee supports the Board in relation to the determination of remuneration policy, the adoption of incentive plans, and various governance responsibilities related to remuneration of its senior executives. The Committee will review performance metrics to ensure these reward executives fairly and responsibly including for the effective management of Environmental Social Governance (ESG) risks such as climate change.

For further information on the Board and its subcommittees, please refer to the company’s Corporate Governance Statement which can be found on the Group’s website at: https://www.alsglobal.com

Management’s role

ALS’s CEO and Executive Leadership Team are accountable for ALS’s actions and commitments to embed climate change into risk management and business strategy. New and emerging risks, including those relating to climate change are monitored periodically by an Executive Risk Management Committee, with changes to the material business risk register reported to the Board as required. Executive General Managers of each Business Stream are responsible for identifying, managing and reporting upon climate risks within their business area and implementing appropriate risk treatments where risks exceed a defined risk appetite. Our operations management team is responsible for energy efficiency and greenhouse gas emissions at each of our site locations, targeting innovation opportunities to reduce our carbon emissions.

Monitoring external audit activities (for both financial and sustainability assurance).

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The corporate sustainability and risk team oversees the collection and consolidation of data and information from across the Group for the purpose of internal and external reporting. The Chief Sustainability Officer monitors sustainability related actions conducted in each business stream and meets regularly with a global network of HSE Lead Managers ensuring effective communication and collaboration on best practice initiatives across the Group.

Performance Incentive Plan

ESG metrics are included in the short-term incentive scheme for the CEO and all executive managers. ESG metrics are selected by the Board of Directors in line with the company’s sustainability strategic plan and include code of conduct compliance, health and safety scorecards, and CO2 emission targets.

Strategy and scenario planning

ALS’s climate change strategy is focussed on managing climate-related risks, identifying opportunities and reducing emissions. We take a proactive approach to managing climate-related risks and opportunities throughout the Group and prioritise those projects that achieve real emissions reduction and generate long term financial and carbon reduction benefits to the company.

Reviewing our climate-related risks and opportunities

In FY2022, ALS engaged The Climate Service (TCS), a division of S&P Global, to conduct scenario analysis to assist us to better understand the physical and transition risks and opportunities that the Group may face on a warmer planet in decades to come. TCFD classifies risks and opportunities by:

Physical Risks – these are risks stemming from the direct impact of climate change on the Group’s physical environment through, for example, resource availability, supply chain disruptions, or damage to assets from severe weather. These risks can be chronic or acute.
Transition Risks – these relate to a wide set of changes in policy, law, markets, technology, and prices that are necessary to achieve the transition to a low-carbon economy.
Climate-related Opportunities – these include benefits to mitigate and adapt to climate change such as resource efficiency and cost savings, development of new products and services, accessing new markets, and building resilience along the supply chain.

Results from our scenario analysis confirms we are facing both climate-related risks and opportunities. For example, the transition to a low-carbon economy will present opportunities from an increased demand for ALS’s services. Policy-related risks may present themselves in the form of climate inaction or slow responses to change. With regards to physical climate risks, our results indicate potential risks related to extreme heat as warming trends could affect employee productivity, health, safety and wellbeing, or result in damage to our site locations.

Time Horizons

We have defined the following time horizons during our analysis:

Timeframe	Period	Rationale
Short term	Now through to FY2027	Aligns with our 5-year Sustainability Strategic Plan.
Medium term	2030 to 2040	Reflects changes from the transition and is a mid- way point of our Net Zero Plan.
Long term	2050 and beyond	The period after 2050 will reflect changes in chronic climate events. We are also committed to implementing our Net Zero Plan by 2050.

Climate modelling conducted by TCS assessed ALS’s largest 150 site locations (representing over 85% of the Group’s total asset values) under three representative concentration pathways (RCP) against physical risks, transition risks and opportunities. The three RCPs used for modelling include:

Very Low Emissions (RCP 2.6)

This scenario assumes that emissions peak early and then fall due to the active removal of greenhouse gases from the atmosphere (sequestration, carbon capture and storage etc.). It is estimated that end-of-century increases in global mean surface temperature will be in the range of 0.9 to 2.3°C.

Tipping Point (RCP 4.5)

This scenario employs coordinated global action to limit warming and hypothesizes that concerted effort to reduce emissions will result in stabilization of global atmospheric energy balance by 2100 and limit warming to between 1.7 to 3.2°C. This increase in average global temperature represents a tipping point whereby

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perturbation of the atmospheric carbon cycle becomes self-reinforcing and disturbance to ecological and natural processes continues to escalate.

Business As Usual (RCP 8.5)

This scenario models increasing greenhouse gas emissions over time with no concerted mitigation efforts. Atmospheric concentration of greenhouse gases become self-reinforcing leading to widespread ecosystem disturbance and collapse. End of century increases in the global mean surface temperature are estimated to be in the range of 3.2 to 5.4°C.

Main risks and opportunities

The ALS Group recognizes that unmitigated climate change represents a material risk to our business and that concerted global action is required to minimize its impact. As a material business risk, management and oversight of climate risk treatments and controls is facilitated within our enterprise risk management framework which is aligned with ISO 31000.

The Group ensures the adequacy of climate related risk controls through ongoing consultation and collaboration with internal stakeholders from across our business including group sustainability and risk, group finance, and the executive leadership team. The material risks identified from the Group’s initial scenario analysis have been summarised within the scope of physical risks and transition risks.

Physical Risks

The most significant physical risk due to climate change to our businesses in both the short and long-term is increasing volatility in temperature extremes (coldwaves, heatwaves) and the impact this has on our employees and our facilities. Other physical risks include coastal flooding from sea level rise and increasing frequency and intensity of extreme weather events and natural disasters.

In response, the Group has updated its loss controls and HSE Foundation Standard to require facilities with an increased exposure to natural perils (modelled under our scenario analysis) to update their emergency response protocols and implement facility resilience and preparation procedures.

Transition Risks

Volatility in markets and changing client preferences is the most significant risk for the Group within the transition risk category. We have also identified that carbon policy and pricing and reputational risks will increase. Each of these transition risks requires robust controls that ensure our strategic decisions are informed by timely and credible market and business intelligence.

The Group must meet the challenge of these risk by maintaining its commitment to decarbonization and ensuring that its strategy embeds appropriate treatments and controls to bolster its market presence now and into the future. The five TIC industry megatrend themes targeted under the Group’s 5-Year Strategic Plan will secure the future of our business by maturing our resilience to sustainability related disruptors, consolidating our global presence within core market segments and diversifying our market share across emerging sustainability related service lines.

5-Year Group Strategy

ALS will strengthen its position as a global leader in the analytical science and testing industry by focussing on:

Advancing Life Sciences: Continued focus on organic and inorganic growth through service diversification and geographic expansion of capabilities within life sciences disciplines.
Advancing Commodities: Continued focus on optimising analytical testing methods and solutions for renewable energy metals.
Technology Development: Foster organisational curiosity, collaboration and culture of innovation through investment in next-generation technology that enhances resilience to industry disruptors.
Sustainability Services Demand: Optimize existing portfolio of services and strategically target growth of sustainability related services to meet changing client demands.
Digital Transformation: Implement digital best practices including the harmonization of existing digital assets through global standards and governance mechanisms, enabling operational excellence, integration and the ability to support business demand at scale.
Energy Transition and Climate Resilience: Commitment to decarbonization as a steward of the environment with strategic emphasis on energy transition to renewables, achieving carbon neutral operations and embedding climate resilience within our business model, operations and facilities.

The ALS 5-year strategic plan establishes short term goals for the group that position us for future growth while addressing climate related risks and opportunities that are both internal and external to our business. Our desired pathway to a low carbon future is underpinned by investment in next generation technologies, digital transformation, service diversification and adapting to meet changing client and market needs.

The tables on the following pages outline our main risks and opportunities that could have a financial impact on the organisation.

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PHYSICAL RISKS	PHYSICAL RISKS	PHYSICAL RISKS
Temperature Extremes Rating (2030) Rating (2050)
Heatwaves and coldwaves are expected to increase in frequency and intensity under climate change modelling.
Description of Financial Impacts Mitigation & Resilience Controls
Increasing operational and capital expenses to meet the costs of facility resilience upgrades, relocations, asset replacements or impairments and increasing insurance premiums. Business interruptions within operations or across value chain and impacts to health and safety of employees leading to reduced productivity and output. Manage acute and chronic weather impacts in contractual negotiations. Conduct natural catastrophe modelling across ALS facilities with cost benefit analysis of facility resilience enhancement versus relocation. Ensure business continuity plans incorporate mitigation control for short to longer term extreme weather events.
Coastal Flooding Rating (2030) Rating (2050)
Increase in average global temperature leads to rising sea levels and coastal inundation.
Description of Financial Impacts Mitigation & Resilience Controls
Physical damage or destruction of ALS Group facilities and increasing operational and capital expenses to meet the costs of facility resilience upgrades, relocations, asset replacements or impairments and increasing insurance premiums. Business interruptions within operations or across value chain and impacts to health and safety of employees leading to reduced productivity and output. Monitor rising sea level events and their impact across ALS facilities. Because these are slow velocity events, our continual assessment will dictate when it will be necessary to move affected site locations. Ensure business continuity plans incorporate mitigation control for short to longer term extreme weather events.
Natural Disasters and Extreme Weather Events Rating (2030) Rating (2050)
Increasing frequency of extreme weather events (drought, wildfire, tropical cyclone, water stress and fluvial flooding) and other natural disasters.
Description of Financial Impacts Mitigation & Resilience Controls
Reduced revenue associated with operational disruptions. Physical damage or destruction of ALS facilities and increasing operational and capital expenses to meet the costs of facility resilience upgrades, relocations, asset replacements or impairments and increasing insurance premiums. Business interruptions within operations or across value chain and impacts to health and safety of employees leading to reduced productivity and output. Conduct natural catastrophe modelling across ALS facilities with cost benefit analysis of facility resilience enhancement versus relocation. Ensure business continuity plans incorporate mitigation control for short to longer term extreme weather events.

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TRANSITION RISKS
Market Risk	Rating (2030) Rating (2050)
Market shifts and sustainability related disruptors erode
market share and ability to compete.
Description of Financial Impacts	Mitigation & Resilience Controls
Evolving regulatory burden for climate risk creates volatility	Leverage market intelligence and analytics tools to proactively monitor
across core market segments as client preferences and	changes across industry, identify emerging disruptors and inform
service requirements change.	strategic planning to bolster resilience of business to volatility.
Ineffective strategic threat monitoring of cross-industry	Embed climate risk and sustainability related scenario planning within
competitors, industry disruptors and new market entrants	client segment strategies and business plans.
exposes ALS to loss of market share.	Diversify exposure across markets through strategic expansion of
Core business assumptions inhibit innovation and capability	existing testing services and tap into emerging and adjacent
to expand into new and emerging markets or to diversify	sustainability markets.
key portfolios and client segments.
Carbon Pricing and Policy	Rating (2030) Rating (2050)
Increasing carbon pricing and/or onerous policy and
regulation instruments.
Description of Financial Impacts	Mitigation & Resilience Controls
Changes in global regulatory landscape and impact on	Establish carbon management policy to provide core guidance on how
carbon pricing will increase financial and non-financial cost	carbon trading is to be conducted within business.
of doing business including carbon taxes and increased price for carbon offsets.	Implement carbon management plan and establish pipeline of decarbonization projects.
Failure to consider the financial and non-financial costs will
impact individual business decisions if there is not a clear	Encourage operational efficiency and promote the required employee behaviours.
decarbonization strategy.
	Create internal carbon price to promote transparency and
	accountability for impact of business decisions. Link GHG performance
	to incentive plans.
Reputation	Rating (2030) Rating (2050)
Perception of corporate inaction on climate change
mitigation and exposure to sunset industries.
Description of Financial Impacts	Mitigation & Resilience Controls
Inability to effectively meet our climate change and	Leverage market intelligence and analytics tools to proactively monitor
sustainability decarbonization commitments or remediate	brand perception, sentiment drift and stakeholder insights.
exposure to carbon intensive industries erodes brand sentiment and leads to increasing client attrition and impaired ability to attract new clients.	Continuously improve the robustness of climate risk and sustainability impact assessment across all business planning and strategic decision- making processes.
Perception of ALS brand as a sustainability and climate change laggard impairs capability to attract and retain talent.	Implement response plans to divest businesses that operate in industries that do not align with our decarbonisation strategy.

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	OPPORTUNITIES
Products and Services		Rating (2030)	Rating (2050)
Diversification of service offering, and market share due to
increased demand for sustainability related TIC services
under a changing environment.
ALS	will target revenue opportunities in core, adjacent and new market segments as demand for climate neutral, low carbon and
sustainability related services increase. Our vision is to be the global leader in the discipline of			scientific analysis in pursuit of a better
world for all.
The	ALS Group will fortify our capability to provide sustainability and climate change related services through quantifying the
opportunities through three lenses:
•	Mitigation:the services we can offer within our core and adjacent markets that will contribute to reducing the impact of climate
	change and promote a healthier future for all.
•	Resilience:the services we can bring to bear across core, adjacent and new markets that help cushion the impact and
	consequences of a changing climate.
•	Innovation:the services we can pioneer across new, consolidated and evolving markets.
We	recognise that some of our clients will have analytical testing and assurance needs across several of our market and service
capabilities, we will take a strategic approach to our client segments that ensures we deliver ‘whole of portfolio’ value to enrich the
client experience. The following opportunities exist across our key market segments:
Food, Pharmaceutical & Healthcare
•	Food Safety and Quality: increase in food borne pathogens or nutritional profile of raw ingredients caused by climate change.
•	Food Security: micro-climate changes will impact resilience of crops and present opportunity to genetically enhance resilience.
•	Healthcare: changes in disease patterns as climate change influences migration of hosts and disease vectors.
Environmental & Earth Sciences
•	Continuous emissions monitoring services for energy industry to assist them in tracking and reporting their carbon footprint and
	meeting regulatory obligations.
•	Natural disaster and ecology-related services that quantify impact on water, soil and air quality and biota.
•	Cross segment services provided for whole of client portfolio clients (e.g., mining companies) that require geochemistry and
	minerals services in addition to environmental remediation and testing services (mine site drainage etc.).
•	Potential for retail services offering as consumer awareness of environmental matters and regulations increases.
•	Soil analysis for nature-based carbon sequestration projects.
Minerals
•	Supporting clients across green minerals/battery minerals exploration and geochemistry activities.
•	Metallurgical testing for the renewables industry with research and development capabilities that promote uptake of next gen
	technologies.
Industrials and Commodities
•	Assisting clients to mitigate unnecessary emissions by providing analytical services that inform optimization of tribology processes
	to minimise friction and energy loss.
•	Analytical testing and engineering expertise to provide assurance to industrial clients as they
	re-engineer and adapt future fuels and lubricants.
•	Supply chain inspection and assurance to quantify the veracity of chain of custody claims.

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Risk Management

Risks attributed to climate change are managed through our group-wide risk management framework. The ALS Group Risk Management Program consists of the ALS Risk Appetite and Tolerance Policy and the ALS Risk Management Policy, together with a suite of enterprise risk management documentation:

Group Risk Register	Summarises each enterprise-wide material business risk. Each register entry outlines the: • threats and opportunities of the risk • inherent, residual and target risk ratings • causes and consequences associated with the risk • existing risk treatments and proposed future treatments, where applicable • risk indicators and metrics used to monitor the risk
Risk Matrix	Categorises each MBR and indicates if the inherent risk of each MBR for the past period presents as an increasing threat, decreasing threat, increasing opportunity, or if there has been no material change in the inherent risk.
Risk Array Chart	Plots the inherent (worst case), target risk (best case), and residual risk (current position) for each MBR.
Risk Velocity Chart	Plots the speed of onset of each MBR against the speed or ability to respond to the risk the MBR presents.
Risk Report Card	HYE and FYE summary report as to each MBR, risk indicators, and whether targets used to monitor the risk have been met. Captures inherent risk rating, residual risk rating, and target risk rating for each risk.
Internal Controls Assurance Matrix	Assurance mapping of each MBR against Group internal control policy, programs and processes. Mapping of controls follows the three lines of defence model.
Risk Treatment Action Plans	Risk treatment action plans are developed and documented in the Group Risk Register for each material business risk where the residual risk rating does not currently meet the target risk rating. Details additional actions required to control or mitigate the risk to target rating, identifies those responsible, and timeline for implementation.

Metrics and Targets

The Group continues to evolve its climate-related metrics and targets. The aim is to establish metrics and targets that are relevant and reliable, and that will drive performance and transparency against its climaterelated goals. During FY23, the Group met its annual target of a 6% reduction in carbon intensity as part of its long-term goal for 40% reduction in carbon intensity by 2030. The Group also took the opportunity to develop ambitious goals for FY23 and beyond which included:

A further 6% reduction in carbon intensity for FY23 against baseline of 2020 for scope 1 & 2 emissions across all Business Streams
At least 90% of all electricity consumed by ALS site locations to be sourced from renewable energy for FY23
Achieve carbon neutrality for the ALS Group for its scope 1 & 2 emissions for FY23.

The Groups main sources of Scope 1 (direct) emissions include emissions from the use of natural gas for heating buildings, transport fuel, and LPG for operating its ample ovens and furnaces, while Scope 2 (indirect) emissions are those associated with electricity use. Scope 3 emissions are indirect emissions (not included in Scope 2) that occur in ALS’s value chain. We measure and report on Scope 1 and Scope 2 greenhouse gas emissions in line with the greenhouse gas protocol. The Audit and Risk Board Committee reviews the full risk register at least annually, which includes a Climate and Environment category. Material business risks under this category include:

Natural disasters (including physical risk and impacts from climate change)
Climate change and ESG disclosures (including market risk and reputational risk)
Environmental management (including natural resources efficiency and biodiversity).

The Sustainability and Innovation Board Committee review all material business risks relating to sustainability. The Committee monitors and reviews risk treatment action plans (RTAP) for those sustainability related risks that do not meet the desired target risk rating. RTAP indicate the planned actions to control or mitigate the risk and identifies persons responsible for the actions within defined timeframes. For FY2023 this included Natural Disasters, Climate Change and ESG Disclosures with the following activities being completed:

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Undertook natural catastrophe modelling across all ALS regions and implemented specific disaster recovery plans for hub laboratories in high-risk natural catastrophe zones.
Collated and reported scope 1 and 2 emissions.
Reviewed scope 3 emission categories outlined in the GHG Protocol and estimated scope 3 emissions utilising the Quantis evaluator tool.
Implemented energy and waste saving initiatives as per Sustainability Strategic Plan.
Further aligned climate change disclosures with TCFD framework (as documented in the company Annual Report and Sustainability Report).

Targets and metrics

As reporting frameworks and standards evolve, the ALS Group continues to improve its climate-related metrics and targets. Our primary goal is to establish metrics and targets that are relevant and reliable, and that will drive performance and transparency against our climate related goals.

Greenhouse Gases

The Group emits greenhouse gases both directly and indirectly. It gathers a range of scope 1 and 2 carbon emission data from all its businesses and has commenced work to measure and validate its estimated scope 3 data. The Group continues to improve its data collection and governance processes.

The Groups main sources of Scope 1 (direct) emissions include emissions from the use of natural gas for heating buildings, transport fuel, and LPG for operating its sample ovens and furnaces, while Scope 2 (indirect) emissions are those associated with electricity use. Scope 3 emissions are indirect emissions (not included in Scope 2) that occur in ALS’s value chain such as purchased goods and services, capital goods, upstream transport, employee commute, waste generated in operations, and business travel.

The Group provides comprehensive data around its ESG governance, frameworks, programs and targets within its annual sustainability report including detailed data for the Group’s greenhouse gas emissions. The FY2023 Sustainability Report is available on the company website at alsglobal.com.

Targets

In FY2022 we set ambitious carbon emission reduction goals for FY2023 which included:

A 6% reduction in carbon emission intensity for scope 1 & 2 across all Business Streams
At least 90% of all electricity consumed by ALS site locations to be sourced from renewable energy for FY2023
Achieve carbon neutrality for the ALS Group for its scope 1 & 2 emissions.

We are pleased to confirm that all these targets have been met, and in FY2023 the Group developed further ambitious targets under a plan to reach net zero by 2050. ALS are committed to the following targets for carbon emissions reduction in accordance with our net zero roadmap:

GHG	2030	2050
Scope 1	78%	95%
Scope 2		95%
Scope 3		90%

The Executive Management Team’s performance is linked to a short-term incentive remuneration program. Key performance indicators have been set for the CEO and all Executive General Managers that include targets for reduction in greenhouse gas emissions aligning with the company’s Net Zero Plan.

The group’s strategic and pragmatic approach to managing climate related risks and opportunities will ensure we continue our path towards decarbonization and meet the expectations of clients and stakeholders to preserve our market position as a preferred leader and sustainability partner in the tic industry.

ENVIRONMENTAL REGULATION

The Group is committed to complying with environmental legislation, standards, and codes of practice relevant to the particular business in the areas in which it operates. A number of hub laboratories are regulated under State and local government legislation predominately for their hazardous waste generation and disposal. Each hub laboratory holds a current licence and or consent from the relevant environment protection authority or local council where required.

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Environmental management

As part of the Group’s compliance program, environmental matters are reported on monthly by all divisional managers. In addition, internal signoffs are completed by all managers on a yearly basis, reporting on performance against relevant environmental legislation and key environmental risks in their area of operations. Apart from complying with local legal requirements each site location across the world operates under the corporate health safety and environment foundation standard which sets out 17 key standards including identification and management of key environmental risks, emergency planning, reporting environmental incidents, and completion of regular audits.

Initiatives

There were a number of environmental initiatives implemented during the year across the Group. These are explained in detail in our Sustainability Report for FY2023, a copy of which can be found on our website.

Performance against environmental compliance requirements

There were no material breaches of environmental statutory requirements during the reporting period. Internal and external audits and internal reporting and monitoring have indicated a high level of compliance with site licence conditions, relevant legislation and corporate minimum standards.

INDEMNIFICATION AND

INSURANCE OF DIRECTORS

liabilities incurred by that person or employee as an officer of the Company or of a Group entity where the Company requested that person or employee to accept that appointment).

every person and employee who is or has been an officer of the Company or of a Group entity where requested to do so, including a director or secretary, against reasonable legal costs incurred in defending an action for a liability incurred by that person or employee as an officer of the Company or of a Group entity (including such legal costs incurred by that person or employee as an officer of the Company or of a Group entity where the Company requested that person or employee to accept that appointment).

Insurance premiums

During the financial year, the Company paid insurance premiums in respect of directors’ and officers’ liability and personal accident insurance contracts, for current and former directors and senior executives, including senior executives of its controlled entities. The current directors are listed elsewhere in this report. The insurance relates to:

costs and expenses incurred by the relevant officers in defending proceedings, whether civil or criminal and whatever their outcome; and
other liabilities that may arise from their position, with the exception of conduct involving a wilful breach of duty or improper use of information or position to gain a personal advantage.

It is a condition of the policies that premiums paid, and terms and conditions of the policies are not to be disclosed.

AND OFFICERS

Indemnification

Under its Constitution, and by resolution of the Board, the Company has agreed to indemnify to the extent permitted by law and the Corporations Act 2001:

every person and employee who is or has been an officer of the Company or of a Group entity where requested to do so, including a director or secretary, against any liability (other than for legal costs) incurred by that person or employee as an officer of the Company or of a Group entity (including

STATE OF AFFAIRS

Changes in the state of affairs of the Group during the financial year resulted from its continued strategy of business expansion and diversification.

In the opinion of the Directors there were no other significant changes in the state of affairs of the Group that occurred during the financial year under review not otherwise disclosed in this report or the consolidated financial statements.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

A letter from the chairman – unaudited

Dear Shareholders

On behalf of the ALS Limited Board (the “Board”), I am pleased to present our remuneration report outlining the remuneration of the Group’s Key Management Personnel (“KMP”).

While an Australian listed company, ALS is a truly global business with most of our workforce, clients and operations located outside of Australia, including many of our Senior Executives and Board members. As we compete globally for talent and market share, the Board reviews our remuneration framework to ensure an appropriate balance which allows us to effectively compete to attract, motivate and retain key talent both at home in Australia and in the markets we serve around the world.

ALS delivered another strong financial performance in FY23 despite a challenging environment.

Revenue from continuing operations (up 19.5%) and underlying net profit after tax from continuing operations (up 23.4%) both grew strongly. Underlying net profit after tax from both continuing and discontinued operations exceeded the revised upward guidance issued in March 2023, and dividends to shareholders increased 21.0%. These results were driven by strong overall performance, particularly within the Minerals segment and the Environmental business, while also pursuing a growth agenda and maintaining a focus on our people, safety, and sustainability. Strong cash conversion and an overall improvement in working capital maintained our strong balance sheet. Our liquidity and leverage ratio remains solid. During FY23 we achieved carbon neutrality[18] and the Board approved a roadmap to achieve Net Zero[19] by 2050, which reflects our strong commitment to the continued investment in a comprehensive ESG program.

We remain very positive about the future of ALS and have made meaningful progress towards the new five-year strategic plan’s objectives. The Company is well positioned to capture industry megatrends, with a clear focus on delivering sustainable growth and aligning the portfolio to robust growth end markets.

Managing Director and CEO Transition

On 7th March we announced that Mr Raj Naran had resigned as Managing Director and CEO for personal reasons. Details of the remuneration arrangements for Mr Naran are detailed on page 34.

On the same day we also announced the appointment of the Company’s Chief Strategy Officer Mr Malcolm Deane as Acting Managing Director and CEO pending the completion of a global search. Mr Deane’s remuneration arrangements were announced to the ASX on 13 March 2023 and are detailed on page 34.

To ensure the retention of key executives during the CEO transition period, retention arrangements were put in place for Mr Luis Damasceno and Mr Andreas Jonsson. Each executive will be eligible to receive 1 x their 2023 Fixed Remuneration paid as 60% in cash and 40% in performance rights vesting after one year and two years respectively, provided they meet certain conditions including that they remain employed with the Group on 31 May 2024 and then 31 May 2025.

On 8th May, following completion of the global search and selection process, Mr Deane was appointed to the role of Managing Director and Chief Executive Officer on a permanent basis. His remuneration arrangements, which were disclosed to the ASX on that day are also detailed on page 34.

FY23 Remuneration Outcomes for ongoing KMP

Fixed Remuneration and framework changes

In recognition of the increased scope of the KMP roles and the continued market demand for senior executives in the industry internationally, Executive KMP received increases in fixed remuneration ranging from 3% to 15% and an increase in LTI opportunity from 60% to 110%. STI opportunities remained at 60% at target. These increases reflected benchmarking against relevant industry and geographic peers.

18 For scope 1 and 2 emissions against the FY2020 baseline

19 Net Zero target is to reduce absolute scope 1 and 2 emissions by 95% and scope 3 emissions by 90% by 2050 against a baseline of FY2020

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Short Term Incentives (STI)

Our strong performance against the Financial, Strategy and ESG KPIs, resulted in commensurate STI vesting outcomes for the KMP for FY23 ranging between 38% and 96% of maximum. Outperformance against financial targets, particularly underlying EBIT and NPAT within the Minerals segment and at the corporate level, strong cash and debt management, strong safety and sustainability outcomes, and consistent progress against key non-financial strategic objectives drove this deserved STI outcome.

Long Term Incentives (LTI)

As a result of sustained performance against each of the four performance hurdles over the three-year performance period, the 2020 LTI Awards will vest at 100%. Achievement at this level of target performance reflects a balanced and consistently robust performance against EPS, relative EBITDA (versus peers), relative TSR and ROCE performance measures, each of which was scored at the full 25% level.

Changes for FY24

Following comprehensive benchmarking undertaken in the previous year and in line with remuneration adjustments across the group globally, the Board determined that for FY24 all Executive KMP should receive an inflation-based uplift to their fixed remuneration. Adjustments, reflecting CPI in their home countries, ranged between 4% and 5%.

Following the increase in LTI opportunities in FY23 and in order to continue to ensure market competitive remuneration for our key executives, the Board determined an increase to STI opportunities from 60% to 70% at target was warranted for the majority of KMP.

The Board continues to review both STI and LTI targets to ensure that they remain challenging and are aligned to the strategic objectives of ALS. In the case of LTI targets, the Board has determined to amend the comparator group used for the calculation of the relative margin component by the removal of Mistras and Team Inc. and the substitution of Montrose Environmental Group Inc. and Marlowe Plc. Given their relatively low EBITDA margins and reduced scale of Team Inc. and Mistras’ current operations, these entities are no longer considered suitable comparator companies. Montrose Environmental Group Inc. and Marlowe Plc. were selected as suitable new comparator entities due to their competitive EBITDA margins, relative scale of operations, competitive market overlap, and complementary client base when compared with ALS.

Finally, Non-executive Director (NED) base retainer fees have been increased by 4.5%, reflecting CPI increases to remuneration across the group.

Due to the increased complexity of the global business, and the associated workload of Directors and in order to give flexibility for overlap of Director tenures as we manage Board succession, we will seek shareholder approval to increase the cap on the number of Directors from 8 to 12. No increase in fee pool will be sought following the increase last year.

Thank you for your ongoing support of ALS and supporting our remuneration practices as our unique business continues its growth and evolution. We look forward to engaging with you at our 2023 Annual General Meeting.

Yours faithfully,

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Bruce Phillips Chairman

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Remuneration report – audited

OUR GLOBAL BUSINESS AND KEY MANAGEMENT PERSONNEL

ALS has evolved to be a truly global business. Although listed on the ASX and headquartered in Brisbane, Australia, we now operate in over 70 countries with a total of over 19,000 staff worldwide.

The graphic below shows our locations and an approximate breakdown of the Group’s revenue by region and the location of our staff and executive KMP.

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----- Start of picture text -----

AMERICAS
EMENA
Revenue $948.4m
Staff 7,080 Revenue $514.5m
Staff 7,441
KMP 3
KMP 1
AFRICA ASIA PACIFIC
Revenue $54.5m Revenue $883.5m
Staff 585 Staff 3,979
KMP 1
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Table 1 below sets out the details of each KMP in FY23:

		Term as KMP
Name	Position	in 2022–23	Location
Non-Executive Directors
Bruce Phillips	Chairman of the Board/ Member of People Committee / Chair of Nominations Committee	Full Year	Australia
John Mulcahy	Member of Audit and Risk Committee / Member of People Committee / Member of Nominations Committee	Full Year	Australia
Charlie Sartain	Chair of Sustainability and Innovation Committee / Member of Audit and Risk Committee / Member of Nominations Committee	Full Year	Australia
Tonianne Dwyer	Chair of People Committee / Member of Sustainability and Innovation Committee / Member of Nominations Committee	Full Year	Australia
Siddhartha Kadia	Member of Sustainability and Innovation Committee / Member of People Committee / Member of Nominations Committee	Full Year	USA
Leslie Desjardins	Chair of the Audit and Risk Committee / Member of Nominations Committee	Full Year	USA
Peter Possemiers	Member of Sustainability and Innovation Committee/Member of	1-Nov-22 to 31-Mar-23	Switzerland
	Nominations Committee

Executives
Raj Naran	Managing Director and Chief Executive Officer	1-Apr-22 to 7-Mar-23	USA
Bruce McDonald	Executive General Manager, Minerals	Full Year	Canada
Andreas Jonsson	Executive General Manager, Food & Pharmaceutical	Full Year	Sweden
Tim Kilmister	Executive General Manager, Environmental	Full Year	Australia
Luis Damasceno	Chief Financial Officer	Full Year	USA
Malcolm Deane	Acting Managing Director and Chief Executive officer	7-Mar-23 to 31-Mar-23	USA

TABLE 1

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SNAPSHOT OF FY23

Organisational performance

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Revenue $2,421.2m  19.5% Underlying EPS 66.3c  23.2%
Underlying EBIT $490.7m  21.8% Underlying EBIT margin 20.3%  2.0%
Underlying NPAT $320.6m  23.4% Dividends per share 39.7c  21.0%
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EBIT = Earnings before interest and tax. The terms Underlying and EBIT are non-IFRS disclosures . These have been presented to assist in the assessment of the relative performance of the Group from period to period. The calculations thereof are based on non-IFRS information and are unaudited.

Executive variable remuneration outcomes

The below chart summarises the variable remuneration outcomes for the Acting CEO and all Executives (on average) during FY23.

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Actual Pay of Executives in FY23

Table 2 below lists Total Fixed Remuneration (TFR), and other remuneration received by all Executives in relation to the financial year ending March 2023.

This information differs from that provided in the statutory remuneration Table 22 disclosed later in this report, which shows the accounting expense of remuneration in respect of each year, determined in accordance with accounting standards rather than the value of remuneration (including LTI grants that vested) received during the year.

FY23 Remuneration received and due (non-IFRS & non-audited):

In AUD			Total cash		Total
	TFR and		payments	Equity vested	remuneration
Directors:	allowances	STI(a)	received	during year(b)	received
Executive Director
Malcolm Deane(c) (e)	833,784	198,548	1,032,333	157,172	1,189,505
Continuing Executives
Bruce McDonald(c)	740,867	443,476	1,184,343	374,163	1,558,506
Andreas Jonsson(c) (f)	916,698	154,914	1,071,612	298,841	1,370,453
Tim Kilmister	571,400	185,973	757,373	360,368	1,117,741
Luis Damasceno(c)	846,402	346,226	1,192,628	390,918	1,583,546
Total All Continuing Executives	3,909,151	1,329,137	5,238,288	1,581,462	6,819,750
Former Executive Director
Raj Naran(c) (d)	1,873,077	554,317	2,427,394	1,342,146	3,769,540
					*TABLE 2*

(a) Accrued STI cash component for FY22 paid in FY23.

(b) Performance Rights are granted annually under the LTI Plan to Executives. The amounts above represent the value of Performance Rights granted in 2019 which vested on 1 July 2022 during the year. It is calculated as the number of shares allocated to Executives multiplied by the $10.88 5- day VWAP of ALS Limited shares on the vesting date. Deferred service rights are granted annually under the STI Plan to Executives. The amounts above represent the value of Service Rights granted in 2020 which vested on 1 July 2022 during the year. It is calculated as the number of shares allocated to Executives multiplied by the $10.88 5-day VWAP of ALS Limited shares on the vesting date.

(c) Mr Damasceno, Mr McDonald, Mr Deane, Mr Naran and Mr Jonsson were employed outside Australia. Relevant portions of their salaries, STI and pension benefits have been converted into Australian dollars above using applicable average FX rates.

(d) Mr Naran’s salary, STI, pension benefits and unused leave entitlements stated up to and including 7 March 2023.

The remuneration information disclosed for Mr Naran does not include any benefits associated with his termination. As part of the termination agreement between the Group and Mr Naran the Group will:

(i.) Pay one year’s remuneration and health and other benefits from the date of termination in monthly instalments. The estimated cost of this is US$ 1.06 million.

(ii.) Allow Mr Naran’s LTI entitlements granted prior to termination to continue to exist. These will vest to Mr Naran over the forward 3 years should the terms of these instruments allow vesting to be achieved. If 100% vest this will entitle Mr Naran to 471,457 shares. The remaining unrecorded expense in relation to these instruments (assuming 100% vest) is AU$ 2.1 million.

The receipt of the above benefits by Mr Naran are conditional on Mr Naran complying with certain requirements which are commensurate with normal terms and conditions associated with the retirement of a Managing Director.

(e) Of the total fixed remuneration and allowances stated for Mr Deane, $76,660 relates to the period after 7 March 2023 when he became a KMP. In the case of STI, he was assessed in his role as Chief Strategy Officer in FY23.

(f) Mr Jonsson’s TFR includes his statutory pension of $273,795.

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Remuneration Arrangements for CEO Transition

On 7th March Mr Raj Naran advised the Board of his intention to retire for personal reasons. In consideration of undertakings given by Mr Naran and of non-compete restrictions, the following arrangements were agreed with Mr Naran:

Cash payments of USD$1.06 million being 12 months Total Fixed Remuneration to be paid over 12 months and FY23 STI payment of USD$ 371,315 reflecting the strong financial and operational performance of the business during FY23.
Continuation of certain health and other benefits for 12months; and
Vesting in the ordinary course of any outstanding Performance Rights under LTI schemes and Service Rights under STI deferral schemes in prior years. Refer to table 25 for further details.

On 7th March Mr Deane was appointed Acting Managing Director and CEO. His cash remuneration of USD$ 650,000 and potential FY24 incentives being STI at 70% and LTI at 110% of remuneration were announced to the ASX on 13 March 2023.

On 8th May, Mr Deane was confirmed in the position of Managing Director and CEO on a permanent basis. His cash remuneration of USD$ 910,600, plus allowances of USD$ 140,000 and potential incentives being STI at 70% and LTI at 150% were announced to the ASX on the same day.

Changes to Executive Remuneration Framework

As foreshadowed in last year’s remuneration report, the below elements of the Executive Remuneration Framework were adjusted in FY23 to ensure its continued effectiveness and competitiveness:

Element	Change and Objective
	During FY22 the Group completed an external review of its Executive Remuneration Framework to
	ensure it remains effective and appropriate for ALS as it expanded into a larger and increasingly more
	global business. The review identified that the Groups variable remuneration opportunity for its
	Executives was below market for similar sized companies in our industry and geographies. To ensure
	continued competitiveness in FY23, the following changes were made:
LTI Opportunities
	• CEO’s maximum LTI opportunity increased to 150% of TFR and
	• KMP’s maximum LTI opportunity increased to 110%
	With effect from FY24 STI and LTI opportunities will be increased as highlighted in the Chairman’s
	letter.

TABLE 3

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EXECUTIVE REMUNERATION FRAMEWORK

Our remuneration strategy

ALS Group Vision

To be the global leader in the discipline of scientific analysis in pursuit of a better world for all. Our goal is to use the power of testing to solve complex challenges, serve clients with data-driven insights for a safer and healthier world, and to provide a workplace that enables our diverse staff the opportunity for growth and positive engagement in a safe, inclusive environment to achieve sustainable growth and shareholder value creation.

Translated into Group Strategy and developed into group structure, plans and policies:

Group Strategy

The Group’s five-year Strategic Plan drives all activities in the business. Each year an annual business plan is prepared for each Business Unit which examines the components that will need to be achieved during the year; and longer-term goals are recalibrated and adjusted as required.

The Group’s five-year Strategic Plan is translated to the remuneration strategy that will assist the Group in achieving its financial and other business goals

Transparent link to individual performance and tied to strategic outcomes.

Executive Reward Strategy

Set at 1 April each year and reviewed annually in response to internal and external changes to ensure the benefits of Executive motivation, attraction and retention are achieved.
Reasonable, fair, and equitable while providing a sustainable platform for growth.

Delivered through the Fixed and Variable (STI and LTI) remuneration components

Fixed Remuneration

Executives are paid a salary plus superannuation / pension benefits (based on local laws) (collectively, TFR ) which is not performance tested. Executives may also receive other allowances.
TFR reflects an Executive’s unique qualities (role, responsibilities, experience, location, internal relativities etc) and is reviewed annually to ensure competitiveness in a tight global talent market.

STI KPIs reward financial, operational, strategic, ESG and HSE outcomes:

Annual plan providing Executives the opportunity to earn STI subject to key performance indicators ( KPIs ), where awards are paid 70% in cash and 30% is deferred to service rights.[ (a)]

Short Term Incentive (STI)

Each Executive has a tailored set of financial and non-financial KPIs set for their role.
The Group achieving a minimum NPAT target acts as a gateway to any STI becoming payable, after which individual achievement of a minimum financial threshold value acts as a gateway for achievement of any non-financial KPI’s.

The LTI is contingent on multiple performance measures to ensure sustainable performance and aligns key executives’ financial outcomes with Shareholder interests over the long term:

Grant of performance rights each year, vesting based on the Group’s 3-year performance.

Long Term Incentives (LTI)

Four equally weighted Hurdles are tested: (1) EPS Growth; (2) TSR (relative against ASX 100 peers); (3) EBITDA Margin (relative against industry peers); and (4) ROCE.

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Remuneration is designed to align executive reward to growth in shareholder value:

STI Financial KPIs incentivise financial growth against last year’s performance to pay out at target, while Non-Financial KPIs are aligned with operational and/or strategic objectives aimed at creating long-term shareholder value.

Alignment with Shareholders

Use of four equally weighted LTI Hurdles (two relative and two absolute) with performance assessed over a 3-year performance period promotes sustainable performance, with global and local peer performance comparisons for balanced assessment.

Remuneration partly received in equity with 2- and 3-year vesting windows combined with mandatory shareholding requirement for retention and to align Executives with shareholder experience.

Strengthened through robust governance and operational risk management:

A Board of Independent Directors (advised by Board Committees and specialist advisors) has full discretion over all reward components and final remuneration outcomes.
Governance & • Specific risk-focused elements play crucial roles in Executive remuneration, including (1) STI deferral and
Risk Management variable remuneration clawback provisions for Malus and Code of Conduct circumstances; (2) specific Code of Conduct KPIs in the STI; and (3) financial gateway ensuring affordability of the STI.

For an illustration of ALS’ remuneration, see the ‘’Governance Structure’ section.

TABLE 4

(a) Deferral percentage of STI has been corrected from the FY22 Remuneration Report to reflect the terms of the ALS STI Plan Rule s and Awards.

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Remuneration mix

The following graphs show the target and maximum remuneration mix of the Acting CEO and Other Executives (on average) in FY23:

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The following table shows the incentive opportunities available to KMP in relation to performance in FY23.

At Risk Remuneration

Short-Term Incentive Opportunity	Long-Term Incentive Opportunity
Name % of Fixed Remuneration
Threshold Target Outperformance
Andreas Jonsson 26% 60% 90% Tim Kilmister 26% 60% 90% Bruce McDonald 26% 60% 90% Luis Damasceno 36% 60% 90% Malcolm Deane* 34% 60% 90%	110% 110% 110% 110% 110%
Awarded in cash with 30% of total payment awarded in Service Rights 3-year vest

*Malcolm Deane based on CSO role

Table 5

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THE LINK BETWEEN PERFORMANCE AND REWARD

Organisational performance

As detailed in in the Chairman’s letter, in FY23 the Group delivered a record result with underlying Net Profit After Tax (UNPAT) at the top-end of the upgraded guidance. The Group has delivered strong organic growth, margin accretion and made highly strategic acquisitions.

The financial data in respect of the current and previous four financial years, and its relationship to Executive pay, is set out below:

Measure of financial performance	Fluctuation in financial performance is reflected in Executives' pay via:	2023	In millions of AUD 2022 2021	In millions of AUD 2022 2021	2020	2019
Underlying profit* attributable to equity holders of the Company	STI gateway, STI KPIs and LTI financial Hurdles	324.2	264.2	185.9	188.8	181.0
Profit / (loss) attributable to equity holders of the Company	STI gateway, STI KPIs and LTI financial Hurdles	291.2	190.5	149.0	127.8	152.6
Dividends paid or payable	LTI TSR Hurdle	192.2	158.4	111.4	84.9	109.3
Share price at balance date	LTI TSR Hurdle	$12.36	$13.40	$9.68	$5.56	$7.59

* Underlying profit (from both continuing and discontinued operations) is a non-IFRS disclosure and is unaudited.

TABLE 6

To assist with understanding how our shareholders’ continued investment in ALS has performed relative to other options open to them, the chart below shows ALS’ share price performance versus:

Global listed competitors of ALS in the testing, inspection, and certification industry; and
The ASX 100 – being the comparator group for the purposes of testing the LTI’s rTSR Hurdle.

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FY23 STI outcomes

The STI outcomes reflect very strong performance for the year as set out above and in the Chairman’s letter. FY23 saw the commencement of the new global organisational structure and the launch of the new FY23-27 strategic plan. KPIs were focused on ensuring the successful launch of these key transformation initiatives and designed to align the organisation around the key drivers of future success for the Group as well as building organisational capability and driving our sustainability strategy.

The Acting CEO’s STI outcome for FY23 was 71% of maximum opportunity and the average outcome across the other Executives was 63%. In the case of Mr Deane, his performance for the year has been assessed in his role as Chief Strategy Officer, noting his appointment to Acting CEO commenced on 7 March 2023. In the case of Mr Jonsson, the Board exercised its discretion to award him 38% of maximum opportunity to reflect his recent transition to Executive General Manager (EGM) of the Food and Pharmaceutical business unit, notwithstanding that the unit did not hit threshold performance for the year. Executives’ KPI achievements are broken down in more detail in Table 7 below. See Table 8 for the STI outcomes in overall monetary and percentage terms.

Before confirming STI outcomes, the Board confirmed that both the Group’s minimum Underlying NPAT gateway ($284.3 million) and individual Threshold Financial KPIs had been achieved for KMP.

Component Details of the measures used in each component Weighting (% of STI opportunity) Applicable to:	Component Details of the measures used in each component Weighting (% of STI opportunity) Applicable to:	Achievements Outperfor- mance Outcome for Shareholders Vesting Outcome Threshold Target -10% +10%	Achievements Outperfor- mance Outcome for Shareholders Vesting Outcome Threshold Target -10% +10%	Achievements Outperfor- mance Outcome for Shareholders Vesting Outcome Threshold Target -10% +10%
Financial	Group / Business Unit performance For Executive KMP, the financial hurdles are set within the Executive’s sphere of control. The performance KPIs for FY23 were: • For the CEO and CFO - overall Group Underlying NPAT results • For other Executive KMP – to ensure a group impact as well as focus on the areas within the Executive’s sphere of control, performance measures were split between Group Underlying NPAT and Underlying EBIT of their respective business unit 55% Acting CEO 50% CFO 60% others average Group Minerals Environmental Food & Pharmaceutical			UNPAT of $321.3 million exceeded UNPAT target of $315.9 million reflecting 19.5% revenue growth, margin improvement and strong overall performance (FY22 UNPAT was $264.2 million) Food & Pharmaceutical did not meet threshold performance due to challenging economic conditions Acting CEO: 55% / 55% CFO: 50% / 50% Others average: 41%/60%











			in Europe
	Other Financial measures Additional financial measures in the scorecard focused Executives on individual financial objectives, including improvement in: • Portfolio management and margin improvement • Divestment 10% CFO Group	Achieved Deliver portfolio and margin improvement Divestment of Asset Care business Delivered organic margin improvement of 130bps With the divestment of Asset Care, we delivered the margin improvement of 99bps CFO: 10% / 10%

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	Executive KMP were also assessed against their	Executive KMP were also assessed against their	25% Acting	Group	Achieved	As per the acquisition strategy,	Acting CEO:
	contribution to and performance against ALS’s strategic goals. This included:		CEO and CFO 20% others		Strategy implemented and communicated	executed 13 acquisitions with additional revenue of $116 million for the next 12 months	25% / 25% CFO:
Strategy	• • • •	Strategy implementation Restructuring completion Establishment of an agile pricing strategy and accompanying pricing change methodology Accelerate ERP implementation	average		Restructuring of business streams completed Pricing tracking tool implemented for Life Sciences	Closed underperforming businesses in Food & Pharmaceutical divisions Achieved margin improvement in Environmental division of 52bps after implementation of pricing tool	24%/25% Others average: 20% / 20%
					ERP Pilot phase for United States and
					Australia
	This component focuses Executive KMP on objectives		10% Acting	Group	Achieved	Focus on ESG measures continues to	Acting CEO:
ESG	in connection with the Group’s sustainability goals. This included: • Commitment to ALS climate strategy • Achieve carbon neutrality for scope 1 and 2 • Achieve > 6% reduction in carbon intensity • Promote community engagement initiatives • Refreshed DE&I framework • OHS positive performance indicators		CEO 5% CFO 10% others average		Industry Leading LTIFR of 0.31 and TRIFR of 1.00 (per million hours worked) >10% reduction in scope 1 and 2 carbon emission intensity Net Zero roadmap approved by Board DE&I refreshed roadmap implemented Provided a total economic contribution of $2.4 billion	underpin our culture and the long- term sustainability of our business By implementing DE&I effective policies, management ensures that the company will be able to attract and retain top talent Likewise, companies with strong DE&I frameworks increase the financial return in comparison with the industry medians	10% / 10% CFO: 5%/5% Others average: 10% / 10%
	•	Actively promote entrepreneurism alongside	10% Acting	Group	Achieved	Promoting ALS innovation	Acting CEO:
		operational excellence as an organisational culture. Demonstrate actions to foster the strengthening of an innovation incubation methodology, increasing opportunity for automation technologies and the enhancement of ALS data analytics capabilities	CEO and CFO 10% others average		Developed a global innovation framework and roadmap under the new structure rollout and communicated during FY23 51% of total new professional	capabilities drive global efficiencies, improve productivity creating an increase return to our shareholders Developing a strong succession pipeline ensures the long-term health and success of the	10% / 10% CFO: 7%/10% Others average:
Organisational	• •	Succession planning Complete implementation of organisational			hires were female 9 greenfield projects across Americas,	organisation Under the new organisational structure announced during FY23,	6% / 10%
Capability	•	changes Gender representation initiatives			EMEA and APAC, with total start-up costs of $3.9 million	the company is now able to focus on leveraging global opportunities connected to the extended footprint,
					Implementation of succession planning for global roadmap	by optimizing the operational models and enhancing the added value proposition to our clients. This will
					New organisational structure	allow the company to achieve its
					was implemented	strategic plan objectives for FY27

TABLE 7

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Table 8 below illustrates the STI outcomes above for each Executive in overall monetary and percentage terms.

Total cash STI included in remuneration	Total deferred equity STI awarded	Total STI awarded Total STI awarded vs TFR and allowances received	Total STI awarded vs max STI opportunity	Total STI forfeited vs max STI opportunity
Executive $(a)	$(b)	$ %(c)	%	%(d)
Malcolm Deane(e) 198,548 Bruce McDonald 443,476 Andreas Jonsson(f) 154,914 Tim Kilmister 185,973 Luis Damasceno 346,226	85,092 190,061 66,392 79,703 148,383	283,640 34% 633,537 86% 221,306 34% 256,676 46% 494,609 58%	71% 96% 38% 52% 68%	29% 4% 62% 48% 32%
Former Executive
Raj Naran 554,317	–	554,317 30%	33%	67%
				*TABLE 8*

(a) Amounts included in remuneration for the financial year represent the STI cash components which vested in the financial year based on the achievement of personal goals and satisfaction of specified performance criteria.

(b) STI announced to be paid in Service Rights to be granted in FY24. These values are included in the values of share-based awards in Table 22 and the remuneration mixes detailed previously and Financial Statements note 8a for details.

(c) TFR includes pension fund contributions and travel allowances.

(d) The amounts forfeited are due to the performance or service criteria not being met in relation to the financial year.

(e) STI awarded is the full year entitlement, the calculation is based on the annual TFR entitlement effective 7 March 2023.

(f) In the case of Mr Jonsson, in recognition of his transition to EGM Food & Pharmaceutical the Board exercised its discretion to award an STI payment at 38% of maximum opportunity in recognition of his performance in his first year in the role, notwithstanding that the unit did not hit threshold performance for the year. Total STI awarded vs TFR inclusive of pension amount is 24%.

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2020 LTI Award vesting outcomes

Achievements against each of the Hurdles for the 2020 LTI award assessed over the 2020-2023 performance period is set out in more detail below.

Hurdle and weighting	Achievement Details Vesting %
EPS Growth 25%	Vesting under this Hurdle required a minimum threshold of a 6% p.a. increase for 12.5% of Performance Rights to vest, with maximum vesting of 25% achieved for a 10% p.a. or higher increase (straight line vesting in between). The compound annual growth rate in the Group’s diluted underlying EPS over the three-year period to March 2023 was 19.9% p.a. (from 39.0 cents to 67.0 cents). This outcome is above the maximum target threshold of a 10% per annum increase resulting in maximum vesting. 25%
EBITDA Margin 25%	Vesting under this Hurdle required a minimum threshold of 50thpercentile performance against the TIC industry peer comparator group for 12.5% of Performance Rights to vest, with maximum vesting of 25% achieved for 75thpercentile or higher performance (straight line vesting in between). The underlying EBITDA margin achieved by the Group over the three-year period to March 2023 was 25.33%. As shown below, this placed the Group at the 85.7thpercentile and ranked 2nd within the comparator group which is above the maximum target threshold of the 75thpercentile resulting in maximum vesting. Company Currency Cumulative underlying (a) EBITDA (m) Cumulative Revenue (m) EBITDA Margin % Rank Percentile Eurofins EUR 4,827 18,869 25.58% 1 100% ALS AUD 1,608 6,350 25.33% 2 85.7% SGS CHF 4,328 18,651 23.21% 3 71.4% Intertek GBP 1,946 8,721 22.31% 4 57.1% Bureau Veritas EUR 2,942 15,233 19.31% 5 42.9% Applus EUR 831 5,384 15.43% 6 28.6% Mistras USD 173 1,957 8.84% 7 14.3% Team Inc. USD 63 2,567 2.46% 8 0.0% 25%
rTSR 25%	Vesting under this Hurdle required a minimum threshold of 50th percentile performance against the ASX 100 comparator group for 12.5% of Performance Rights to vest, with maximum vesting of 25% achieved for 75th percentile or higher performance (straight line vesting in between). ALS’s return to shareholder performance over the three-year period to March 2023 relative to the ASX 100 comparator group was at the 86.6th percentile which is above the maximum target threshold of the 75th percentile resulting in maximum vesting. 25%
ROCE 25%	Vesting under this Hurdle required a minimum threshold of an 11% ROCE during the performance period for any Performance Rights to vest, with maximum vesting of 25% achieved for a 16% or higher ROCE (straight line vesting in between). The Group’s ROCE over the three-year period to March 2023 was calculated as 18.7% which is above the maximum target threshold of 16% resulting in maximum vesting. 25%
Total:	100%
	*TABLE 9*

(a) Cumulative underlying EBITDA for peer companies includes government subsidies. Cumulative underlying EBITDA for ALS excludes government subsidies, noting ALS elected to return all government subsidies that had been received during early COVID-19 relief measures.

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Historical vesting outcomes for incentives

Table 10 below lists the historical vesting outcomes of incentives at ALS in recent financial years (each ending 31 March):

	2023 2022 2021 2020 2019
STI(b) LTI(a) (b)	65% 97% 69% 48% 83% 100% 100% 97% 75% 86%

TABLE 10

(a) This is the outcome of the grant that vested in the particular year.

(b) Outcomes expressed as a percentage of maximum opportunity at the time of grant.

LINK BETWEEN PERFORMANCE, REMUNERATION OUTCOMES AND SHAREHOLDER WEALTH

It is appropriate for remuneration outcomes to reflect the underlying shareholder wealth generated and ALS’ business performance.

In considering whether the Executive Remuneration Framework remains aligned with the shareholder experience, the Board considers various key drivers of organisational performance and shareholder wealth. ALS' share price performance and level of STI and LTI vesting versus ALS’s Underlying NPAT (which underpins STI outcomes) show a strong correlation with organisational performance translating to increased shareholder wealth. The chart below reflects the remuneration of the previous CEO Mr Naran to FY22, and Mr Deane for FY23, acknowledging the CEO transition occurring in FY23. This is illustrated in the graphs below.

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SHORT TERM INCENTIVE PLAN

As part of their variable remuneration, Executives are invited to participate in an annual Short Term Incentive Plan ( STI ), which is contingent on the achievement of specified key performance indicators ( KPI ) as well as the ‘Gateway’ and clawback conditions set by the Board for the financial year.

Summary of terms

What is the purpose of the STI?	The STI is intended to incentivise and potentially reward Executives for their individual performance in driving key organisational strategies each year. The Board considers the STI to be both: • a driver of shareholder wealth by incentivising Executives to focus on the day-to-day practices and behaviours that translate to longer term organisational growth and sustainability; and • a key component of a competitive remuneration package for ALS’ Executives.
What is the opportunity and how are STI outcomes measured?	KPIs are generally set based on the following opportunity levels (with linear outcomes for performance between levels). Certain Non-Financial/Strategic KPIs are assessed on less formulaic targets but with the same principles as to performance levels applied. Level Details Opportunity Threshold The minimum performance to be achieved for any STI payment to be earned, provided the gateway is achieved. Achievement at Threshold results in payment of Individual KPIs only. 34% of TFR for the Acting CEO 36% of TFR for the CFO 26% of TFR for Other Executives Target The budgeted performance which is intended to be challenging and require achievement in excess of performance from the prior year. Achievement at Target results in 100% of STI quantum at Target. 60% of TFR Outperformance Significant achievement beyond target performance, for which maximum STI payments may be earned. Achievement at Outperformance results in 150% of STI quantum at Target. 90% of TFR (i.e., 150% of Target)
How are STI payments delivered?	70% of any STI payment earned by an Executive is delivered to them in cash at a date determined by the Board after the end of the financial year. 30% of any STI payment earned is delivered in Service Rights – being rights to Shares vesting following a two-year deferral period. The Executive must be still employed on 1 July two years hence for Service Rights to vest (2025 in the case of the FY23 STI) to receive the Shares (see note 8a of the Financial statements for further details). The number or Service Rights granted to an Executive is determined by dividing their deferred STI payment by the volume weighted average price of Shares as determined appropriate by the Board at that time.
What about for overseas Executives?	Where an individual Executive’s country of assignment has legislation that would prevent allocation of Shares, their deferred STI payment would instead be held by ALS as cash deferred for the same two-year period.

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What were the gateway	The Group overall must have met or exceeded an Underlying NPAT threshold before the STI
condition(s)?	is paid. The threshold is set by the Board each year based on their evaluation of circumstances
	and conditions impacting the Company’s performance, with the intention of ensuring a
	threshold that is fair and representative of shareholder and company expectations for
	sustainable growth and pay for performance. Exceptions may be made by the Board where an
	individual Executive has achieved an outstanding financial result but the Group’s gateway has
	not been achieved.
	For FY23, the Board set the Underlying NPAT gateway as $284.3 million, being 90% of the
	FY23 Underlying NPAT target of $315.9 million.
	Regardless, no STI payments are paid for Non-Financial/Strategic KPIs unless at least
	Threshold performance is achieved against an Executive’s Financial KPI.
What KPIs were used to	Scorecards in FY23 comprised a mix of Financial and Non-Financial/Strategic KPIs as set out in
assess performance?	Table 7, with an emphasis on financial and strategic targets. As in previous years the STI is
	heavily weighted to financial performance, along with a continued focus on KPIs related to
	Environment, Social, People & Organisational Capability, Governance and Culture.

TABLE 11

LONG TERM INCENTIVE PLAN

As part of their variable remuneration, Executives are invited each year to participate in a Long-Term Incentive Plan (LTI). The following table sets out the terms of the LTI plan issued during FY23 for the performance period 1 April 2022 to 31 March 2025 (the 2022 LTI Plan).

Summary of terms of the 2022 LTI Plan

What is the purpose of the	The LTI is intended to reward Executives for collectively driving superior organisational
LTI?	performance that is expected to translate to long term and sustained growth in
	shareholder wealth.
	It is an important component of remuneration at ALS as its quantum and longer
	performance period serves to attract, motivate and retain high-performing and often
	internationally based Executive talent (where market practice is for large long-term grants
	of equity) while aligning their interests with shareholders through equity-based reward.
What is the performance	Three years, commencing 1 April of the first year and ending 31 March of the third
period?	anniversary from grant.
What is the opportunity?	Executives may earn an LTI up to a maximum value of 110% of TFR.
How are LTI payments	Executives are granted Performance Rights at the commencement, which either vest and
delivered?	exercise into Shares or lapse depending on performance against the Hurdles.
	Where the Board determines Performance Rights will vest, they vest and are exercised on
	1 July following the end of the Performance Period.
What is the exercise price?	Executives do not pay any price on grant, vesting or exercise of their Performance Rights.
How are Performance	The number of Performance Rights granted to an Executive is calculated by dividing the
Rights allocated?	amount of their LTI maximum opportunity by the volume weighted average price (VWAP)
	of Shares over the 10 trading days following the date of announcement of full year results
	for the financial year immediately preceding the LTI award.
What about for overseas	Where an individual Executive’s country of assignment has legislation that would prevent
Executives?	allocation of Shares, their Performance Rights are cash-settled on vesting, calculated per
	the VWAP of Shares over the 10 trading days following the date of announcement of full
	year results of the performance period’s last financial year.

TABLE 12

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LTI Hurdles for the 2022 LTI Plan

LTI outcomes are determined based on the Group’s performance against each Hurdle, with results for each Hurdle based on the targets determined by the Board for each LTI award. Performance is assessed following the end of the performance period.

Since the 2017 LTI award the LTI has been contingent on four equally weighted (25% each) Hurdles, the targets of which are reviewed annually and adjusted before granting of each award as the Board considers appropriate.

The Board believes the combination of two relative and two absolute Hurdles provides an appropriate combination of measures of those matters within management’s ability to influence and those that are influenced by external factors. Having four measures ensures that outcomes are not distorted by factors impacting any one Hurdle.

The Tables below detail each of these Hurdles:

HURDLE 1: UNDERLYING EPS GROWTH

Description	The Group’s compound annual underlying earnings per share (EPS) growth on a fully diluted basis over the performance period.
Purpose	Chosen because it provides a good indicator of the shareholder value derived from earnings growth and can be directly influenced by management.
How is it measured?	Underlying EPS growth is calculated by comparing the diluted underlying EPS from continuing operations achieved by the Group in the base year (e.g. year to March 2022) with that achieved in the final year of the performance period (e.g. year to March 2025). Diluted underlying EPS is calculated by dividing the underlying net profit after tax attributable to shareholders of ALS Limited by the weighted average number of ordinary shares on issue for the year being measured (diluted for outstanding equity-settled Performance Rights).
Vesting Schedule	Outcome Vesting % <8% p.a. 0% 8% – 12% p.a. 12.5% – 25% p.a. (straight line vesting) 12% p.a. or higher 25%

TABLE 13

HURDLE 2: UNDERLYING Relative EBITDA MARGIN

Description	The Group’s underlying earnings before interest, tax, depreciation, and amortisation (EBITDA) margin over the performance period relative to the EBITDA margins of a comparator group of ALS’s key global TIC (Testing, Inspection, and Certification) industry competitors.
Purpose	Chosen because it is focused on driving cash earnings and productivity, over which management has direct influence and provides for a fair assessment of performance against our global TIC industry competitors.
How is it measured?	Underlying EBITDA margin is calculated by dividing the cumulative underlying EBITDA by the cumulative Revenue over the three-year performance period. This is compared with the cumulative EBITDA margins reported by each of the peer companies for the three financial years ending on or before 31 March of the year of vesting.
Who is in the TIC comparator group?	Bureau Veritas (France), Eurofins (France & Germany), Intertek (UK), SGS (Switzerland), Mistras (USA), Applus (Spain), Team Inc. (USA).
Vesting Schedule	Outcome Vesting % <50thpercentile 0% 50th– 75thpercentile 12.5% – 25% p.a. (straight line vesting) 75thpercentile or higher 25%

TABLE 14

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HURDLE 3: RELATIVE TOTAL SHAREHOLDER RETURN

Description	The total return delivered to ALS shareholders during the performance period relative to total returns delivered to shareholders by the companies comprising the ASX 100 (rTSR).
Purpose	Chosen because it provides a good indicator of the value derived from capital growth and distributions to shareholders, with the companies in the comparator group representing the alternative investment choices for many of our investors.
How is it measured?	rTSR is calculated by measuring the growth of ALS’s Share price over the performance period plus the value of dividends notionally reinvested in Shares. This return value is then compared to the return value achieved across the ASX 100 comparator group during the same period.
Vesting Schedule	Outcome Vesting % <50thpercentile 0% 50th– 75thpercentile 12.5% – 25% p.a. (straight line vesting) 75thpercentile or higher 25%
HURDLE 4: ROCE	*TABLE 15*
Description	The Group’s return on capital employed (ROCE) generated over the performance period.
Purpose	Chosen because it assesses the Group’s success or otherwise in increasing its net worth – i.e., it needs to generate returns in excess of its cost of capital in order to add to its value.
How is it measured?	ROCE is calculated as underlying earnings before interest and tax over the three-year performance period divided by Capital Employed expressed as a percentage. 'Capital Employed' is defined as 'Total Shareholders’ Equity' plus 'Net Debt' and is calculated as the sum of the simple averages of the balances at the beginning and end of each year during the performance period. If material funding transactions (for example, significant additional borrowings, equity issuances or asset impairments) occur such that the simple average for any year during the performance period is not representative of capital actually employed, the average capital employed for the year may be adjusted for the effect of these transactions. In order to provide an incentive for superior performance, targets for the ROCE Hurdle are set each year at 2% and 7% above the weighted average cost of capital (WACC) as at 31 March with straight line vesting in between the lower and upper targets.
Vesting Schedule	Outcome Vesting % <14.2% 0% 14.2% – 19.2%. 0% – 25% (straight line vesting) 19.2% or higher 25% _ Based on ALS’s pre-tax Nominal WACC as at March 2022._

TABLE 16

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Evolution of LTI Hurdle Targets

The following table shows the key determinants of the hurdles for current ‘in flight’ LTI schemes.

		LTI Scheme	LTI Scheme	LTI Scheme
Offer Year	2020	2021	2022	2023
Vest Year	2023	2024	2025	2026
Earnings per Share growth	6-10%	6-10% 8-12% 8-12%
Relative EBITDA Margin Comparator group	Bureau Veritas (France)	Bureau Veritas (France) Bureau Veritas (France) Bureau Veritas (France)
	Eurofins (France & Germany)	Eurofins (France & Germany) Eurofins (France & Germany) Eurofins (France & Germany)
	Intertek (UK)	Intertek (UK) Intertek (UK) Intertek (UK)
	SGS (Switzerland)	SGS (Switzerland) SGS (Switzerland) SGS (Switzerland)
	Mistras (USA)	Mistras (USA) Mistras (USA) Marlowe Plc.
	Applus (Spain)	Applus (Spain) Applus (Spain) Applus (Spain)
	Core Laboratories	Team Inc. (USA) Team Inc. (USA) Montrose Environmental Group Inc.
Relative TSR	ASX100	ASX100 ASX100 ASX100
ROCE	11-16%	11.9-16.9% 14.2-19.2% 15.5-20.5%

TABLE 17

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INCENTIVE PLAN GOVERNANCE

Common terms

To ensure the integrity of ALS’s variable remuneration structures and that outcomes reached are appropriate and justified, the plan rules applicable to both the STI and LTI contain the following provisions.

Provision	Description
Board discretion	At all times, the Board retains a broad discretion to adjust an Executive’s variable remuneration outcomes as it sees fit, where it considers doing so to be the appropriate action in the relevant circumstances.
	Where an Executive has found to have engaged in serious misconduct (e.g., fraud, dishonesty, misstatement)
Malus & Clawback	the Board may exercise broad powers in relation to the Executive’s variable remuneration, including to lapse/forfeit on-foot grants and to clawback outcomes already paid/vested with the Executive.
	This includes circumstances where an Executive is found to have misrepresented the financial and non-financial
	KPI results under the STI or manipulated the outcomes of any LTI hurdles.
	Unvested variable remuneration grants may either lapse, remain on foot, or vest on termination, depending on
	the circumstances, at the Board’s discretion and in accordance with section 200B and section 200E of the
Cessation of	Corporations Act.
employment	Termination of ‘good leavers’ generally allows for proportionate vesting of an Executive’s variable
	remuneration grants. Grants do not vest and immediately lapse/are forfeited for ‘bad leavers’ (e.g., those who
	resign or are terminated for cause).
Change of Control	The Board retains the discretion to determine the treatment of on-foot variable remuneration grants where a change of control event (e.g., a Takeover Bid) arises. Generally, it is anticipated that the performance period will be brought forward in these circumstances.
Anti-hedging	Consistent with ALS’ Securities Trading Policy, participants are prohibited from entering into any arrangement aimed at hedging the economic benefit of their participation in the STI or LTI.
	Under the STI plan, in the event of either (1) a workplace related fatality or (2) a material breach of the Code of
	Conduct which is determined (following an investigation by either (a) an external Regulatory Authority or (b) an
Other	internal representative working under the Authority of the Board) to have occurred in circumstances where
	there were organisational deficiencies in place which contributed to the incident, then the CEO and other STI
	participants in the Group within which the fatality or breach occurred will forfeit their STI.

TABLE 18

Executive minimum shareholding requirement

ALS has now introduced a Minimum Shareholding Requirement ( MSR ) for all Executives (including the CEO). The purpose of the MSR is to tie a significant portion of Executives’ wealth to the long-term performance of the Company so that their long-term interests and experience is aligned with that of shareholders.

Each Executive is expected to build a meaningful shareholding within five years from 1 April 2021 (or the date they commenced as an Executive if later) and maintained through the duration of their employment as an Executive.

This MSR is monitored annually, with the status of compliance as at 31 March 2023 set out in Table 19 below. It is anticipated that all Executives will meet their MSR by their deadline date based on targeted STI and LTI outcomes.

Executives	Current MSR (% of TFR)	MSR Deadline Date	MSR Status(a)
Malcolm Deane(b)	50	8 May 2028	In Progress
Bruce McDonald	50	1 April 2026	Fulfilled
Andreas Jonsson	50	1 April 2026	Fulfilled
Tim Kilmister	50	1 April 2026	Fulfilled
Luis Damasceno	50	1 April 2026	Fulfilled
				*TABLE 19*

(a) The quantum of the shareholding is measured based on a combination of the Shares, Service Rights and any vested (but not yet exercised) Performance Rights held directly or indirectly by the Executive. Any Performance Rights granted but not yet vested do not count towards the Executive’s MSR.

(b) Mr Deane’s MSR is attributable to his role of Chief Strategy Officer for the year

A MSR equivalent to one year’s net fees (after tax) is applicable for Non-Executive Directors and must be met within 3 years of starting as a NED. All Non-Executive Directors have fulfilled or are on track to meet this requirement.

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NON-EXECUTIVE DIRECTOR REMUNERATION

Remuneration policy

No element of Non-Executive Director remuneration is ‘at risk.’ Non-Executive Directors are instead paid fees that are fixed and not based on the performance of the Company or equity based, with the maximum total amount payable (‘pool’) capped at the limit approved at general meetings of the Company’s shareholders.

Fees are set following annual reviews of publicly available information about fees paid to Non-Executive Directors in comparable sized, global companies including international competitors. The NED remuneration framework is reviewed regularly, and fees are adjusted by the Board, where considered appropriate.

Non-Executive Directors are also entitled to be reimbursed for all travel and related expenses properly incurred in connection with the business of the Company.

Fee structure

Non-Executive Directors are paid base fees and if applicable, a fee for membership of a committee. The Chairman does not receive committee fees. All fees are fixed inclusive of mandatory superannuation contributions. The fees that applied in FY23 are set out in the table below. For FY24 the Base Fee for the Chairman and the Non-Executive Directors will be increased by 4.5%

Non-Executive Director – Fee Structure	* Fixed Pool: $1,897,500 per annum
Base Director Fees
Chairman	Annual fee compensates for all Board & Committee activities	$370,755
Non-Executive directors	Annual fee	$181,913
Committee Fees
Chair of Audit & Risk Committee		$25,000
Chairs of People Committee and Sustainability and Innovation Committee		$20,000
Committee membership Fees	Flat fee for each Committee membership**	$10,000

Pool and fees include superannuation benefits. ** No fees for Nominations Committee membership. TABLE 20*

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Governance structure

Below is an illustration of the structure for how Executive and NED remuneration matters are governed at ALS:

==> picture [489 x 648] intentionally omitted <==

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OTHER STATUTORY DISCLOSURES

Service contracts

Each KMP has entered into new service agreements with the Group, the key terms of which are as follows.

	Currency of TFR		Termination	Restraint
Executive	specified in contract	Term of agreement	Notice period(a)	Period(b)
Malcolm Deane	USD	Ongoing – continues until either	12 months	12 months
		notice is given or termination
Raj Naran	USD	Ongoing – continues until either notice is given or termination	12 months	12 months
Bruce McDonald	CAD	Ongoing – continues until either	12 months	12 months
		notice is given or termination
Andreas Jonsson	SEK	Ongoing – continues until either	12 months	12 months
		notice is given or termination
Tim Kilmister	AUD	Ongoing – continues until either	12 months	12 months
		notice is given or termination
Luis Damasceno	USD	Ongoing – continues until either	12 months	12 months
		notice is given or termination

(a) The period required for termination by notice by either party under an Executive’s service agreement.

(b) The maximum period that the Group may elect to pay fixed remuneration to an Executive.

TABLE 21

Executive service agreements also contain clauses spelling out non-competition, intellectual property, and confidentiality restrictions.

The Group also has formal service agreements with its Non-Executive Directors. Non-Executive Directors are not entitled to any retirement or termination benefits.

Statutory remuneration of KMP

Table 22 on the following page shows the accounting expense of remuneration paid or payable to each Executive and Non-Executive Director in relation to the financial years ending March 2022 and March 2023, determined in accordance with accounting standards.

For information on the remuneration received (non-IFRS and non-audited) by Executives during FY23 refer to Table 2.

Notes to Table 22 (following)

(a) Accrued STI cash component which is paid following the end of the financial year to which it relates.
(b) Non-monetary benefits include the provision of healthcare, motor vehicles and other benefits.
(c) Performance Rights are granted annually under the LTI Plan to Executives – refer to financial statements note 8a for details. The fair value of Performance Rights granted is calculated using Binomial Tree (EPS, EBITDA, and ROCE hurdles) and Monte-Carlo Simulation (TSR hurdle) valuation methodologies and allocated to each financial year evenly over the period from grant date to vesting date. Note that the valuation is not reflective of actual remuneration received by the Executive. For FY23 the value of share-based awards also includes an accrual to March 2023 of the estimated value of any Service Rights earned as deferred compensation under the STI – refer to Financial Statements note 8a for details.
(d) Mr Naran, Mr Damasceno, Mr McDonald, Mr Jonsson and Mr Deane were employed outside Australia during FY23. Relevant portions of their salaries, STIs and pension benefits have been converted into Australian dollars using applicable average FX rates.
(e) Mr Damasceno and Mr Jonsson each received increases to their annual salary (effective from 1 April 2021) as a result of market competitive pay review and overall high-level of performance.
(f) Ms Walsh ceased employment with the Group on 8 October 2021, with the amounts set out in Table 22 representing the accounting value of remuneration paid to her for the period between 1 April 2021 and her cessation date. In connection with her cessation, Kristen Walsh forfeited her entitlements to 2019 and 2020 Long Term Incentive awards.
(g) Mr Possemiers was appointed to the Board as a Non-Executive Director effective 1 November 2022.
(h) Mr Deane was appointed as the Acting Managing Director and CEO effective 7 March 2023 and is considered KMP from this date. The amounts disclosed in the table below reflect the income earned whilst considered KMP.

(i) Mr Naran resigned as Managing Director and CEO effective 7 March 2023. The remuneration information disclosed for Mr Naran does not include any benefits associated with Mr Naran's termination. As part of the termination agreement between the Group and Mr Naran the Group will:

(i.) Pay one year’s remuneration and health and other benefits from the date of termination in monthly instalments. The estimated cost of this is USD$1.06 million.

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Remuneration as determined in accordance with accounting standards:

KMP (In AUD)	Short-term
Executive Director
Malcolm Deane(d) (h) 2023 2022	73,298 198,548 1,986 42,705 274 1,376 318,186
	– – – – – – –
Continuing Executives
Bruce McDonald(d) 2023 2022	734,547 443,476 6,321 524,623 3,283 – 1,712,249
	686,117 426,334 6,173 353,924 4,822 – 1,477,371
Andreas Jonsson(d) (e) 2023 2022	642,903 154,914 – 412,221 3,283 273,795 1,487,116
	608,069 346,743 – 284,436 4,822 237,525 1,481,595
Tim Kilmister 2023 2022	543,900 185,973 – 351,556 3,283 27,500 1,112,212
	493,077 322,129 – 250,953 4,822 26,923 1,097,905
Luis Damasceno (d) (e) 2023 2022	802,295 346,226 25,535 521,614 3,283 18,572 1,717,524
	693,882 440,776 21,615 364,323 4,822 15,913 1,541,333
Sub-total: Continuing Executives 2023 2022	2,796,942 1,329,137 33,842 1,852,720 13,404 321,244 6,347,288
	2,481,146 1,535,982 27,789 1,253,636 19,290 280,361 5,598,203
Former Executive Director
Raj Naran(d) (i) 2023 2022	1,812,671 554,317 42,521 1,411,293 3,743 17,885 3,842,430
	1,542,714 803,047 15,158 1,144,614 5,201 15,913 3,526,647
Former Executives
Kristen Walsh(f) 2023 2022	– – – – – – –
	431,590 – – (133,516) 2,813 14,080 314,967
Total: All Executives 2023 2022	4,609,613 1,883,454 76,363 3,264,013 17,147 339,128 10,189,718
	4,455,450 2,339,029 42,947 2,264,734 27,304 310,354 9,439,817

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FOR THE YEAR ENDED 31 MARCH 2023

KMP (In AUD)	Short-term	Short-term
Non-Executive Directors
Bruce Phillips 2023 2022	345,894 – – – 3,743 24,861 374,498
	329,174 – – – 5,201 23,926 358,301
John Mulcahy 2023 2022	182,934 – – – 3,743 18,979 205,655
	168,601 – – – 5,201 16,649 190,451
Charlie Sartain 2023 2022	206,879 – – – 3,743 5,034 215,656
	187,392 – – – 5,201 4,358 196,951
Tonianne Dwyer 2023 2022	191,994 – – – 3,743 19,919 215,656
	174,517 – – – 5,201 17,233 196,951
Siddhartha Kadia 2023 2022	206,480 – – – 3,743 – 210,222
	191,219 – – – 5,201 – 196,420
Leslie Desjardins 2023 2022	211,599 – – – 3,743 – 215,342
	204,643 – – – 5,201 – 209,844
Peter Possemiers(g) 2023 2022	79,405 – – – 1,248 559 81,211
	– – – – – – –
Total: All Non- Executive Directors 2023 2022	1,425,183 – – – 23,706 69,352 1,518,240
	1,255,546 – – – 31,206 62,166 1,348,918

TABLE 22

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

KMP equity instruments and transactions

Ordinary shares

The movement during the year in the number of ordinary shares in ALS Limited held directly, indirectly, or beneficially by each member of the KMP, including their related parties, is as follows:

			Acquired due to
	Opening		vesting of Performance			Closing
	Balance	Purchases	/Service Rights	Sales	Other(b)	Balance
Directors
Bruce Phillips	60,160	–	–	–	–	60,160
John Mulcahy	54,027	25,000	–	–	–	79,027
Charlie Sartain	90,000	–	–	–	–	90,000
Tonianne Dwyer	27,148	–	–	–	–	27,148
Siddhartha Kadia	9,380	–	–	–	–	9,380
Leslie Desjardins	7,300	6,800	–	–	–	14,100
Malcolm Deane	–	–	–	–	–	–
Peter Possemiers	–	11,470	–	–	–	11,470
Executives
Bruce McDonald	40,160	–	34,390	(41,000)	–	33,550
Luis Damasceno	38,670	–	35,930	(40,000)	–	34,600
Andreas Jonsson	71,383	–	27,467	–	–	98,850
Tim Kilmister	85,102	–	33,122	(59,912)	–	58,312
Former Executive Director
Raj Naran(a)	259,680	–	123,359	(208,708)	(174,331)	–

TABLE 23

(a) Raj Naran ceased employment with the Group on 7 March 2023.

(b) Represents balance of shareholding when Mr Naran ceased to be KMP

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

Performance Rights and Service Rights over ordinary shares granted as remuneration

The movement during the year in the number of Performance Rights and Service Rights over ordinary shares in the Company held directly, indirectly, or beneficially by each member of the KMP, including their related parties:

	Opening	Granted as	Vested &		Closing	Total Rights
Type of Right	Balance	compensation(a)	exercised	Lapsed(b)	Balance	held at close
Executive Director
Performance	44,896	34,097	(13,648)	–	65,345
Malcolm Deane (c)						71,553
Service	798	6,208	(798)	–	6,208
Executives
Performance	104,943	61,206	(34,390)	–	131,759
Bruce McDonald						154,119
Service	8,003	14,357	–	–	22,360
Performance	110,221	62,210	(35,930)	–	136,501
Luis Damasceno						186,507
Service	6,707	43,299	–	–	50,006
Performance	84,657	55,631	(27,467)	–	112,821	153,710
Andreas Jonsson
Service	6,498	34,391	–	–	40,889
Performance	76,708	49,441	(26,062)	–	100,087
Tim Kilmister						110,935
Service	7,060	10,848	(7,060)	–	10,848
Former Executive Director
Performance	380,676	166,938	(123,359)	–	424,255
Raj Naran(d)						471,457
Service	20,159	27,043	–	–	47,202

TABLE 24

(a) Relates to grants of deferred equity under FY22 STI plan (issued on 15 June 2022 at $12.73 per share), plus retention arrangements for Mr Damasceno and Mr Jonsson as noted in the Chairman's letter.

(b) The number of Rights lapsed represents those Rights which either lapsed due to performance hurdles not being met and/or upon cessation of employment.

(c) This total includes 15,493 performance rights that were granted to Mr Deane in August 2022 in accordance with the 2022 LTI Plan but were inadvertently omitted from the Director’s Initial Interest notice on his appointment as Acting CEO on 7th March 2023. In accordance with best practice, and in accordance with the requirements of the Listing Rules, shareholder approval will be sought for the issue of these performance rights at the upcoming Annual General Meeting.

(d) Mr Naran’s termination benefits as footnoted in table 22.

Vested and outstanding Performance Rights and Service Rights

Details of vested and outstanding Right over shares granted as remuneration to each KMP as either (a) Performance Rights under the LTI Plan or (b) Service Rights under the STI Plan (either in FY21 pursuant to mandatory 30% STI deferral or deferral for previous years’ STI outperformance) are presented in the table below:

				Fair	Issue price	Issue price
			Number	value per	used to			Number of
			of Rights	Right at	determine			Rights	Number		% of
Directors /	Type of Right		granted	grant	no. of	Rights	Vesting	vested &	of	Rights	Rights
Executives	(a)	Grant date	(b)	date(c)	granted(c)		date	exercised	lapsed		lapsed
	Performance	23-Aug-22	34,097	$10.12	$12.73		1-Jul-25	–		–	–
	Performance	28-Jul-21	15,702	$11.20	$12.40		1-Jul-24	–		–	–
Malcolm Deane	Performance	29-Jul-20	15,546	$7.38		$7.22	1-Jul-23	–		–	–
(Director)	Performance	31-Jul-19	13,648	$5.88		$7.06	1-Jul-22	(13,648)		–	0.0%
	Service	15-Jun-22	6,208	$12.73	$12.73		1-Apr-24	–		–	–
	Service	29-Jul-20	798	$7.33		$7.33	1-Apr-22	(798)		–	0.0%

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

				Fair	Issue price
			Number	value per	used to		Number of
			of Rights	Right at	determine			Rights	Number		% of
Directors /	Type of Right		granted	grant	no. of Rights	Vesting	vested &		of	Rights	Rights
Executives	(a)	Grant date	(b)	date(c)	granted(c)	date	exercised		lapsed		lapsed
	Performance	23-Aug-22	61,206	$10.12	$12.73	1-Jul-25		–		–	–
	Performance	28-Jul-21	31,953	$11.20	$12.40	1-Jul-24		–		–	–
Bruce	Performance	29-Jul-20	38,60,0	$7.38	$7.22	1-Jul-23		–		–	–
McDonald	Performance	31-Jul-19	34,390	$5.88	$7.06	1-Jul-22	(34,390)			–	0.0%
	Service	15-Jun-22	14,357	$12.73	$12.73	1-Apr-24		–		–	–
	Service	28-Jul-21	8,003	$12.40	$12.40	1-Apr-23		–		–	–
	Performance	23-Aug-22	55,631	$10.12	$12.73	1-Jul-25		–		–	–
	Performance	28-Jul-21	28,468	$11.20	$12.40	1-Jul-24		–		–	–
	Performance	29-Jul-20	28,722	$7.38	$7.22	1-Jul-23		–		–	–
Andreas Jonsson	Performance	31-Jul-19	27,467	$5.88	$7.06	1-Jul-22	(27,467)			–	0.0%
	Service	28-Mar-23	22,714	$11.27	$11.27	30-May-25		–		–	–
	Service	15-Jun-22	11,677	$12.73	$12.73	1-Apr-24		–		–	–
	Service	28-Jul-21	6,498	$12.40	$12.40	1-Apr-23		–		–	–
	Performance	23-Aug-22	49,441	$10.12	$12.73	1-Jul-25		–		–	–
	Performance	28-Jul-21	25,161	$11.20	$12.40	1-Jul-24		–		–	–
Tim	Performance	29-Jul-20	25,485	$7.38	$7.22	1-Jul-23		–		–	–
Kilmister	Performance	31-Jul-19	26,062	$5.88	$7.06	1-Jul-22	(26,062)			–	0.0%
	Service	15-Jun-22	10,848	$12.73	$12.73	1-Apr-24		–		–	–
	Service	29-Jul-20	7,060	$7.33	$7.33	1-Apr-22	(7,060)			–	0.0%
	Performance	23-Aug-22	62,210	$10.12	$12.73	1-Jul-25		–		–	–
	Performance	28-Jul-21	33,366	$11.20	$12.40	1-Jul-24		–		–	–
	Performance	29-Jul-20	40,925	$7.38	$7.22	1-Jul-23		–		–	–
Luis Damasceno	Performance	31-Jul-19	35,930	$5.88	$7.06	1-Jul-22	(35,930)			–	0.0%
	Service	28-Mar-23	28,456	$11.27	$11.27	30-May-25		–		–	–
	Service	15-Jun-22	14,843	$12.73	$12.73	1-Apr-24		–		–	–
	Service	28-Jul-21	6,707	$12.40	$12.40	1-Apr-23		–		–	–
Former Executive Director
	Performance	23-Aug-22	166,938	$10.12	$12.73	1-Jul-25		–		–	–
	Performance	28-Jul-21	112,574	$11.20	$12.40	1-Jul-24		–		–	–
Raj	Performance	29-Jul-20	144,743	$7.38	$7.22	1-Jul-23		–		–	–
Naran	Performance	31-Jul-19	123,359	$5.88	$7.06	1-Jul-22	(123,359)			–	0.0%
	Service	15-Jun-22	27,043	$12.73	$12.73	1-Apr-24		–		–	–
	Service	28-Jul-21	20,159	$12.40	$12.40	1-Apr-23		–		–	–
											*TABLE 25*

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

(a) All Performance Rights and Service Rights granted to the Executives named above are equity-settled rights.
(b) The number of Performance Rights issued to participants in August 2022 was determined using the volume weighted average price of the Company’s shares during the ten trading days following the announcement of the Group’s annual financial results. This total includes 15,493 performance rights that were granted to Mr Deane in August 2022 in accordance with the 2022 LTI Plan but were inadvertently omitted from the Director’s Initial Interest notice on his appointment as Acting CEO on 7th March 2023. In accordance with best practice, and in accordance with the requirements of the Listing Rules, shareholder approval will be sought for the issue of these performance rights at the upcoming Annual General Meeting.
(c) The grant dates and corresponding fair values per Performance Right and Service Rights in the above table have been determined in accordance with Australian Accounting Standards and are dependent on the dates on which individual Executives are deemed to have received their offers to participate in the Plan. Fair values of Performance Rights have been calculated using Binomial Tree (EPS, EBITDA, and ROCE hurdles) and MonteCarlo Simulation (TSR hurdle) valuation methodologies. Fair value of Service Rights has been calculated using the volume weighted average price of the Company’s shares during the ten trading days following the announcement of the Group’s annual financial results.

End of remuneration report

2023 | Annual Financial Statements

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

EVENTS SUBSEQUENT TO REPORTING DATE

Increase of loan facility

In May 2023, the Group has entered into new additional two-year bilateral revolving multi-currency senior bank facilities totalling USD100 million (AUD149.3 million) with three of its existing bank Lenders. Following the availability of these new bilateral facilities, liquidity available to the Group increases to a revised total of AUD574 million, and the proforma weighted average debt maturity for the Group is expected to be 5.3 years.

Appointment of new CEO and Managing Director

As announced to the ASX on 8 May 2023, the Board has appointed Malcolm Deane as the new CEO and Managing Director of the Company. Malcolm had previously been appointed as the Interim CEO and Managing Director effective from 7 March, following the resignation of the former CEO and Managing Director with effect from this date.

Acquisitions post balance date

Subsequent to 31 March 2023, the Group entered into the following sale purchase agreements. These purchases are either complete or expected to be completed in the near term and are subject to normal terms and conditions precedent. The acquisitions and their expected purchase price are as follows:

Business Acquired	ALS Segment	Consideration $m
ASR Laboratorios Group (Brazil)	Life Sciences	13.5
Hidro Lab d.o.o. (Croatia)	Life Sciences	3.1
Analytical
Solutions Group	Life Sciences	28.0
(India)

LIKELY DEVELOPMENTS

The Group’s objective during the next financial year will be to maximise earnings and investment returns across all the business units in its diversified portfolio. For comments on divisional outlooks refer to the review of results and operations in this report

	No. of Ordinary shares
Bruce Phillips	60,160
John Mulcahy	79,027
Charlie Sartain	90,000
Tonianne Dwyer	27,148
Siddhartha Kadia	9,380
Leslie Desjardins	14,100
Peter Possemiers	11,470
Malcolm Deane	-

DIRECTORS’ MEETINGS

The number of directors’ meetings (including meetings of committees of directors) and number of meetings attended by each of the directors of the Company during the financial year are:

	Board Meetings	Board Meetings	Audit and Risk Committee Meetings ⁽¹⁾	Audit and Risk Committee Meetings ⁽¹⁾	People Committee Meetings⁽¹⁾	People Committee Meetings⁽¹⁾	Sustainability and Innovation Committee Meetings⁽¹⁾	Sustainability and Innovation Committee Meetings⁽¹⁾	Nomination Committee Meetings⁽¹⁾	Nomination Committee Meetings⁽¹⁾
	A	B	A	B	A	B	A	B	A	B
Bruce Phillips	12	12	-	-	3	3	-	-	3	3
Raj Naran	10	10	-	-	-	-	-	-	-	-
John Mulcahy	12	12	4	4	3	3	-	-	3	3
Charlie Sartain	12	11	4	4	-	-	2	2	3	3
Tonianne Dwyer	12	12	-	-	3	3	2	2	3	3
Siddhartha Kadia	12	11	-	-	3	3	2	1	3	3
Leslie Desjardins	12	12	4	4	-	-	-	-	3	3
Peter Possemiers	4	4	-	-	-	-	1	1	1	1
Malcolm Deane	1	1	-	-	-	-	-	-	-	-

A – Number of meetings held during the time the director held office during the year
B – Number of meetings attended

DIRECTORS’ INTERESTS

(1) – All non-member directors generally attend Committee meetings on a standing invitation basis.

The relevant interest of each director in the share capital of the Company as notified by the directors to the Australian Securities Exchange in accordance with section 205G (1) of the Corporations Act 2001 as at the date of this report is:

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

NON-AUDIT SERVICES

During the year EY, the Company’s auditor, has performed certain other services in addition to statutory duties.

The Board has considered the non-audit services provided during the year by the auditor and in accordance with written advice provided by resolution of the Audit and Risk Committee, is satisfied that the provision of those non-audit services during the year by the auditor is compatible with, and did not compromise, the auditor independence requirements of the Corporations Act 2001 for the following reasons:

all non-audit services were subject to the corporate governance procedures adopted by the Company and have been reviewed by the Audit and Risk Committee to ensure they do not impact the integrity and objectivity of the auditor; and
the non-audit services provided do not undermine the general principles relating to auditor independence as set out in APES 110 Code of Ethics for Professional Accountants, as they did not involve reviewing or auditing the auditor’s own work, acting in a management or decision-making capacity for the Company, acting as an advocate for the Company or jointly sharing risks and rewards.

Details of the amounts paid to the auditor of the Company, EY, and its related practices for audit and

non-audit services provided during the year are set out in note 7d.

In millions of AUD	2023 2022
Services other than audit and review of financial statements: Other non-assurance services	0.1 0.1
	0.1 0.1

It is the Group’s policy not to use its external auditor for non-audit services. In very limited circumstances where EY is engaged, pre-approval is sought for the non-audit services being rendered.

Lead auditor’s independence declaration

The Lead auditor’s independence declaration is set out on page 103 and forms part of the directors’ report for the financial year ended 31 March 2023.

Rounding off

The Company is of a kind referred to in ASIC Corporations (Rounding in Financial/Directors’ Reports) Instrument 2016/191 and in accordance with that Instrument, amounts in the financial report and directors’ report have been rounded off to the nearest one hundred thousand dollars, unless otherwise stated.

Signed in accordance with a resolution of the directors:

==> picture [89 x 61] intentionally omitted <==

Bruce Phillips Chairman Brisbane 29 May 2023

==> picture [101 x 82] intentionally omitted <==

Malcolm Deane CEO & Managing Director Brisbane 29 May 2023

2023 | Annual Financial Statements

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

Financial statements

For the year ended 31 March 2023

Consolidated statement of Profit and Loss and Other

Comprehensive Income ............................................ 62 Consolidated Balance Sheet ..................................... 63 Consolidated Statement of Changes in Equity ..................................................... 64 Consolidated Statement of Cash Flows ................... 65 Notes to the Financial Statements ............................ 66 1 Financial overview .......................................... 66-71

1a. Operating segments 1b. Earnings per share 1c. Revenue 1d. Expenses (continuing operations) 1e. Discontinued operations 1f. Other expenses

4 Risk & Capital Management ............................ 80-87 4a. Financial & capital risk management 4b. Capital & reserves 4c. Financial Instruments 4d. Contingencies 4e. Capital commitments 4f. Leases

5 Group structure ............................................... 87-93

5a. Acquisition of subsidiaries
5b. Global operating entities and ultimate parent 5c. Deed of cross guarantee
5d. Parent entity disclosures

6 Taxation ......................................................... 94-96

6a. Income taxes

6b. Deferred tax assets and liabilities

2 Capital Employed: Working Capital and Other Instruments ..................................................... 72-78

2a. Trade and other receivables 2b. Related party transactions 2c. Inventories 2d. Trade and other payables 2e. Property, plant & equipment 2f. Investment property 2g. Intangible assets 2h. Other assets and liabilities

2i. Investments accounted for using the equity method

7 Other information ....................................... 97-101

7a. Basis of preparation

7b. Significant accounting policies
7c. Determination of fair value

7d. Auditor’s remuneration

7e. Events subsequent to balance date

8 Employment matters ................................ 102-105

8a. Share-based payments

8b. Key management personnel disclosures

Signed reports

3 Net debt .......................................................... 78-80

3a. Cash and cash equivalents

Directors’ declaration .............................................. 106

Independent auditor’s report to the members of

3b. Reconciliation of operating profit to net cash

3c. Reconciliation of liabilities arising from financing activities
3d. Loans and borrowings

ALS Limited.............................................................. 107

Lead auditor’s independence declaration .............................................................. 113

2023 | Annual Financial Statements

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

CONSOLIDATED STATEMENT OF PROFIT AND LOSS AND OTHER COMPREHENSIVE INCOME

For the year ended 31 March 2023

COMPREHENSIVE INCOME For the year ended 31 March 2023
In millions of AUD	Note	2023	2022
Continuing operations
Revenue	1c	2,279.2	1,951.8
Expenses	1d	(1,693.3)	(1,490.7)
Other expenses	1f	-	(20.4)
Share ofprofit of equity-accounted investees, net of tax	0	2.5	9.0
Profit before financing costs, depreciation, and amortisation (EBITDA)	0	588.4	449.8
Amortisation on right-of-use assets		(54.3)	(43.6)
Amortisation and depreciation	0	(98.1)	(87.6)
Profit before net financing costs (EBIT)	0	436.0	318.5
Finance income	0	5.4	1.4
Finance cost on loans and borrowings		(40.9)	(32.0)
Finance cost on deferred consideration		(2.1)	(1.3)
Finance cost on lease liabilities	0	(7.7)	(6.7)
Net financing costs		(45.3)	(38.5)
Profit before tax	0	390.7	280.0
Income tax expense	6a	(114.4)	(88.4)
Profit from continuing operations	0	276.3	191.6
Discontinued operations
Profit of discontinued operations, net of tax	1e	16.11616.216.2	0.6
Profit for theyear		2292.5	192.2
Profit attributable to:
Equity holders of the company		291.2	190.5
Non-controllinginterest		1.3	1.7
Profit for theyear	3b	292.5	192.2
Other comprehensive income
Other comprehensive items that may be reclassified to profit and loss in subsequent periods:
Foreign exchange translation		142.0	(5.4)
Income on hedge of net investments in foreign subsidiaries, net of tax		(26.5)	12.7
(Loss) on cash flow hedges, net of tax		(3.4)	(0.1)
Other comprehensive income/(loss) that may be reclassified to profit and loss in subsequentperiods, net of income tax		112.1	7.2
Other comprehensive items that will not be reclassified to profit and loss in subsequent periods:
Share of other comprehensive profit/(loss) of an associate		18.2	(0.4)
Net (loss) on equityinstruments designated at fair value through OCI		(0.2)	-
Other comprehensive (loss) that will not be reclassified to profit and loss in subsequentperiods, net of income tax		18.0	(0.4)
Other comprehensive income/(loss) for theyear, net of tax		130.1	6.8
Total comprehensive income for theyear		422.6	199.0
Total comprehensive income attributable to:
Equity holders of the company		421.3	197.3
Non-controllinginterest		1.3	1.7
Total comprehensive income for theyear		422.6	199.0
Earnings per share
Basic earnings per share attributable to equity holders	1b	60.23	39.45
Diluted earnings per share attributable to equity holders	1b	59.96	39.26
Basic earnings per share attributable to equity holders from continuing operations	1b	56.88	38.56
Diluted earningsper share attributable to equityholders from continuingoperations	1b	56.62	38.38

The notes on pages 66 to 105 are an integral part of these consolidated financial statements.

2023 | Annual Financial Statements

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

CONSOLIDATED BALANCE SHEET

As at 31 March 2023
In millions of AUD	Note	2023	2022
Current assets
Cash and cash equivalents	3a	179.6	122.8
Trade and other receivables	2a	416.6	386.6
Inventories	2c	101.3	71.2
Other assets	2h	55.8	61.3
Total current assets		753.3	641.9
Non-current assets
Investment property	2f	9.8	9.9
Investments accounted for using the equity method		283.7	240.9
Deferred tax assets	6b	24.3	41.8
Property, plant and equipment	2e	580.8	494.6
Right-of-use assets	4f	231.7	198.8
Intangible assets	2g	1,413.9	1,194.8
Other assets	2h	32.7	21.5
Total non-current assets		2,576.8	2,202.3
Total assets		3,330.1	2,844.2
Current liabilities
Trade and other payables	2d	346.3	310.8
Loans and borrowings	3d	179.5	342.3
Employee benefits		58.4	67.2
Other liabilities	2h	28.6	18.3
Total current liabilities		612.8	738.6
Non-current liabilities
Loans and borrowings	3d	1,268.7	895.3
Deferred tax liabilities	6b	22.5	26.2
Employee benefits		7.9	8.0
Other liabilities	2h	40.0	45.4
Total non-current liabilities		1,339.1	974.9
Total liabilities		1,951.9	1,713.5
Net assets		1,378.2	1,130.7
Equity
Share capital	4b	1,326.1	1,321.0
Reserves		(8.7)	(124.7)
Retained earnings		49.5	(76.2)
Total equity attributable to equity holders of the company		1,366.9	1,120.1
Non-controlling interest		11.3	10.6
Total equity		1,378.2	1,130.7

The notes on pages 66 to 105 are an integral part of these consolidated financial statements.

2023 | Annual Financial Statements

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the year ended 31 March 2023

				Foreign		Employee			Non-
In millions of AUD	Note	Share Capital	Currency Translation		Other reserves	share-based awards	Retained earnings	Total	controlling Interest	Total Equity
Balance 31 March 2021		1,304.6	(144.5)		3.6	9.8	(114.8)	1,058.7	10.8	1,069.5
Profit for the year		–		–	–	–	190.5	190.5	1.7	192.2
Other comprehensive income		–		7.320	(0.2)	-	(0.3)	6.8	-	6.8
Total comprehensive income for the period		–		7.3	(0.2)	-	190.2	197.3	1.7	199.0
Transactions with owners in their capacity as owners:
Dividends to equity holders	4b	–		–	–	–	(146.6)	(146.6)	(1.2)	(147.8)
Shares issues under dividend
reinvestment plan (1,285,575		16.6		-	-	-	-	16.6	-	16.6
shares @ $12.88 per share)
Equity-settled performance rights awarded and vested	4b	(0.2)		–	(0.1)	(0.6)	(5.0)	(5.9)	-	(5.9)
Total contributions and distributions to owners		16.4		–	(0.1)	(0.6)	(151.6)	(135.9)	(1.2)	(137.1)
Changes in ownership interests
Capital raising by subsidiary		–		–	–	–	–	–	0.2	0.2
Non-controlling interest ownershipof subsidiaryacquired		–		–	–	–	–	–	(0.9)	(0.9)
Total changes in ownership interest		–		–	–	–	–	–	(0.7)	(0.7)
Total transactions with owners		16.4		–	(0.1)	(0.6)	(151.6)	(135.9)	(1.9)	(137.8)
Balance 31 March 2022		1,321.0	(137.2)		3.3	9.2	(76.2)	1,120.1	10.6	1,130.7
Profit for the year		–		–	–	–	291.2	291.2	1.3	292.5
Other comprehensive income		–		115.4	(3.4)	-	18.2	130.3	-	130.3
Total comprehensive income for the period		–		115.4	(3.4)	-	309.4	421.5	1.3	422.8
Transactions with owners in their capacity as owners:
Dividends to equity holders	4b	–		–	–	–	(180.5)	(180.5)	(1.3)	(181.9)
Shares issues under dividend
reinvestment plan (456,340	4b	5.3		-	-	-	-	5.3	-	5.3
shares @ $11.59 per share)
Equity-settled performance rights awarded and vested		(0.3)		–	(0.1)	4.1	(3.1)	0.5	-	0.5
Total contributions and distributions to owners		5.0		–	(0.1)	4.1	(183.7)	(174.7)	(1.3)	(176.0)
Changes in ownership interests
Capital raising by subsidiary		–		–	–	–	–	–	0.7	0.7
Total changes in ownership interest		–		–	–	–	–	–	0.7	0.7
Total transactions with owners		5.0		–	(0.1)	4.1	(183.7)	(174.7)	(0.6)	(175.4)
Balance 31 March 2023		1,326.1		(21.8)	(0.1)	13.3	49.5	1,366.9	11.3	1,378.2

The notes on pages 66 to 105 are an integral part of these consolidated financial statements.

20 The movement includes $26.9 million of cumulative FCTR on intercompany loans to foreign subsidiaries that was realised during the year ended 31 March 2023 and reclassified as an expense in the profit and loss.

2023 | Annual Financial Statements

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

CONSOLIDATED STATEMENT OF CASH FLOWS

For the year ended 31 March 2023

CONSOLIDATED STATEMENT OF CASH FLOWS For the year ended 31 March 2023
In millions of AUD	Note	2023	2022
Cash flows from operating activities
Cash receipts from customers		2,697.9	2,334.7
Cash paid to suppliers and employees		(2,124.7)	(1,902.8)
Cash generated from operations		573.2	431.9
Interest paid		(48,8)	(40.4)
Interest received		5.4	1.4
Income taxes paid		(89.9)	(106.1)
Net cash from operating activities	3b	439.9	286.8
Cash flows from investing activities
Payments for property, plant and equipment		(146.1)	(118.9)
Loans (to)/from associate entities		6.0	(0.3)
Payments for net assets on acquisition of businesses and subsidiaries (net of cash acquired)	5a	(181.7)	(53.7)
Deferred and contingent consideration payments for acquisitions of controlled entities		(50.5)	(11.2)
Acquisition of investment in Nuvisan	2i	-	(226.7)
Proceeds from business divestments		98.9	-
Dividend from associates		3.6	2.7
Proceeds from sale of other non-current assets		2.8	2.2
Net cash (used in) investing activities		(267.0)	(405.9)
Cash flows from financing activities
Proceeds from borrowings		640.7	407.8
Repayment of borrowings		(532.4)	(153.9)
Principal portion of lease payments		(52.9)	(45.2)
Dividends paid		(176.6)	(131.3)
Net cash (used in)/from financing activities		(121.2)	77.4
Net movement in cash and cash equivalents		51.7	(41.7)
Cash and cash equivalents 1 April		122.8	168.6
Effect of exchange rate fluctuations on cash held		5.1	(4.1)
Cash and cash equivalents 31 March	3a	179.6	122.8

The notes on pages 66 to 105 are an integral part of these consolidated financial statements.

2023 | Annual Financial Statements

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

NOTES TO THE FINANCIAL STATEMENTS

About this report

ALS Limited (the “Company”) is a for-profit company domiciled in Australia. The consolidated financial report of the Company for the year ended 31 March 2023 comprises the Company and its subsidiaries (together referred to as the “Group”) and the Group’s interest in associates and jointly controlled entities.

Throughout this document, non-International Financial Reporting Standards (non-IFRS) (unaudited) financial indicators are included to assist with understanding the Group’s performance. The primary non-IFRS information is underlying earnings before income tax, depreciation, and amortisation (EBITDA), underlying earnings before interest and tax (EBIT) and underlying net profit after tax (NPAT).

Management believes underlying EBITDA, underlying EBIT and underlying NPAT are appropriate indicators of the ongoing operational earnings of the business and its segments because these measures do not include significant one-off items (both positive and negative) that relate to disposed or discontinued operations, preacquisition legal costs, FX losses on corporate loan restructuring, SAAS development costs, amortisation and impairment of intangibles, greenfield start-up costs, net subsidies under COVID-19 economic support programmes and costs incurred to restructure the business in the current period. Underlying results also includes 49% of Nuvisan’s revenue and expenses rather than the Group’s share of Nuvisan’s statutory profits.

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FINANCIAL OVERVIEW

This section provides information that is most relevant to explaining the Group’s performance during the year, and where relevant includes the accounting policies that have been applied and significant estimates and judgements made.

1a. Operating segments
1b. Earnings per share
1c. Revenue
1d. Expenses (continuing operations)
1e. Discontinued operations
1f. Other expenses

1a. Operating segments

The Group has two reportable segments, as described below, representing two distinct strategic business units each of which is managed separately and offers different products and services. For each of the strategic business units, the CEO reviews internal management reports on at least a monthly basis. The following summary describes the operations in each of the Group’s reportable segments:

Commodities – provides assaying and analytical testing services and metallurgical services for mining and mineral exploration companies and provides specialist services to the coal industry such as coal sampling, analysis and certification, formation evaluation services, tribology testing services and related analytical testing.
Life Sciences – provides analytical testing data to assist consulting and engineering firms, industry, and governments around the world in making informed decisions about environmental, food and pharmaceutical, electronics, consumer products, and animal health.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

1a. Operating segments (continued)

2023 Commodities Statutory In millions of AUD	Life Sciences Non- Statutory21 Life Sciences 49% Nuvisan22	Life Sciences Statutory excl Nuvisan23	Other Statutory24	Continuing Consolidated non-Statutory25	Elimination Nuvisan26	Continuing consolidated Statutory Dis -continued Con- solidated Statutory
Revenue 1,087.1	1,334.1 142.0	1,192.1	-	2,421.2	(142.0)	2,279.2 121.7 2,400.9
Africa 54.5 Asia/Pacific 428.4 Europe/Middle East 125.3 Americas 478.9	- - 336.2 - 531.1 142.0 466.8 -	- 336.2 389.1 466.8	- - - -	54.5 764.6 656.4 945.7	- - (142.0) -	54.5 - 54.5 764.6 118.9 883.5 514.5 - 514.5 945.7 2.8 948.4
Underlying EBITDA27 390.3 Amortisation on right-of- use assets (26.7) Depreciation and amortisation (33.6)	302.9 22.9 (38.4) (11.0) (57.6) (3.8)	280.0 (27.4) (53.8)	(45.2) (0.2) (0.8)	648.0 (65.3) (92.0)	(25.7) 11.0 3.8	622.3 11.8 634.1 (54.3) (2.9) (57.2) (88.2) (3.2) (91.4)
Underlying EBIT27 330.3 Restructuring & other items, including net COVID-19 subsidies27 (0.4) Amortisation of intangibles -	206.9 8.1 (10.4) (1.6) - -	198.8 (8.8) -	(46.2) (12.2) (9.9)	490.7 (23.0) (9.9)	(10.9) 1.6 -	479.7 5.6 485.5 (21.4) - (21.4) (9.9) - (9.9)
Segment EBIT27 329.6 Net interest (3.3)	196.5 6.5 (4.7) (0.6)	190.0 (4.1)	(68.3) (37.9)	457.8 (45.9)	(9.3) 0.6	448.5 5.6 454.1 (45.3) (0.3) (45.6)
Segment profit/(loss) before income tax 326.3	191.8 5.9	185.9	(106.2)	411.9	(8.7)	403.2 5.3 408.5
Underlying EBIT margin_27 30.4% _Underlying EBITDA _margin_27 35.9%	15.5% 5.7% 22.7% 16.1%	16.7% 23.5%		20.3% 26.8%		21.0% 4.6% 20.2% 27.3% 9.7% 26.4%
Segment Assets 1,167.7 Cash and cash equivalents Tax assets	- -	1,928.0	30.5	3,126.2	-	3,126.2 - 3,126.2 179.6 24.3
Total assets per the balance sheet						3,330.1
Segment liabilities (264.3) Loans and borrowings Tax liabilities	- -	(404.5)	(29.4)	(698.2)	-	(698.2) - (698.2) (1,202.6) (51.1)
Total liabilities per the balance sheet						(1,951.9)

21 Includes Life Sciences Statutory results plus 49% of Nuvisan’s revenue and expenses, non-IFRS.

22 49% of Nuvisan’s revenue and expenses.

23 EBIT and EBITDA excludes the Group’s share of loss in Nuvisan of $2.9 million.

24 Represents unallocated corporate costs. Net expenses of $46.2 million in 2023 comprise net foreign exchange gains of $2.4 million and other corporate costs of $48.6 million.
25 Consolidated statutory results plus 49% of Nuvisan’s revenue and expenses, excluding the Group’s share of loss in Nuvisan of $2.9 million, non -IFRS
26 49% of Nuvisan revenue and expenses plus the Group’s share of loss in Nuvisan of $2.9 million.
27 Underlying EBITDA = Underlying EBIT plus depreciation and amortisation. Underlying EBIT = Underlying Earnings before interest and tax. The terms EBITDA and EBIT are non-IFRS disclosure and are unaudited. The terms ‘Underlying’ and ‘Restructuring & other items” are defined in the Directors’ report.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

1a. Operating segments (continued)

2022 Comm- odities Statutory	Life Sciences Non- Statutory28 Life Sciences 49% Nuvisan29	Life Sciences Statutory excl Nuvisan30	Other Statutory31	Continuing Consolidated non-Statutory32	Elimination Nuvisan33	Continuing consolidated Statutory Dis- continued Con- solidated Statutory
Revenue 886.5	1,139.1 73.8	1,065.3	-	2,025.6	(73.8)	1,951.8 141.3 2,093.1
Africa 45.5 Asia/Pacific 352.8 Europe/Middle East 109.0 Americas 379.2	- - 294.4 - 443.7 73.8 401.1 -	- 294.4 369.9 401.1	- - - -	45.5 647.2 552.7 780.3	- - (73.8) -	45.5 - 45.5 647.2 128.7 775.8 478.9 - 478.9 780.3 12.6 793.0
Underlying EBITDA34 302.8 Amortisation on right-of-use assets (18.8) Depreciation and amortisation (28.7)	276.5 19.1 (30.9) (6.2) (50.8) (2.3)	257.4 (24.7) (48.5)	(46.3) (0.2) (0.9)	533.0 (49.9) (80.4)	(14.2) 6.2 2.3	518.8 14.2 533.0 (43.6) (3.5) (47.2) (78.0) (4.1) (82.1)
Underlying EBIT34 255.4 Restructuring & other items, including net COVID-19 subsidies34 (12.1) Amortisation of intangibles -	194.8 10.6 (13.3) - - -	184.2 (13.3) -	(47.4) (43.6) (9.6)	402.8 (69.1) (9.6)	(5.7) - -	397.1 6.6 403.7 (69.1) (3.7) (72.7) (9.6) (9.6)
Segment EBIT34 243.3 Net interest (2.5)	181.5 10.6 (4.3) (0.2)	170.9 (4.1)	(100.6) (31.9)	324.2 (38.7)	(5.7) 0.2	318.5 2.9 321.4 (38.5) (0.5) (39.0)
Segment profit/(loss) before income tax 240.7	177.2 10.4	166.8	(132.5)	285.4	(5.5)	279.9 2.5 282.4
Underlying EBIT margin34 28.8% Underlying EBITDA margin34 34.2%	17.1% 14.4% 24.3% 25.9%	17.3% 24.2%		19.9% 26.3%		19.9% 19.3% 26.3% 25.5%
Segment Assets 1,001.9 Cash and cash equivalents Tax assets	- -	1,541.3	41.3	2,584.5	-	2,584.5 95.2 2,679.6 122.8 41.8
Total assets per the balance sheet						2,844.2
Segment liabilities (221.5) Loans and borrowings Tax liabilities	- -	(362.0)	(21.4)	(604.9)	-	(604.9) (39.7) (644.6) (1,024.4) (44.5)
Total liabilities per the balance sheet						(1,713.5)

28 Includes Life Sciences Statutory results plus 49% of Nuvisan’s revenue and expenses, non-IFRS.
29 49% of Nuvisan’s revenue and expenses.
30 EBIT and EBITDA excludes the Group’s share of profit in Nuvisan of $4.9 million.
31 Represents unallocated corporate costs. Net expenses of $47.4 million in 2023 comprise net foreign exchange gain of $2.6 million and other corporate costs of $50.0 million.
32 Consolidated statutory results plus 49% of Nuvisan’s revenue and expenses, excluding the Group’s share of profit in Nuvisan of $4.9 million, non -IFRS
33 49% of Nuvisan revenue and expenses plus the Group’s share of profit in Nuvisan of $4.9 million.
34 Underlying EBITDA = Underlying EBIT plus depreciation and amortisation. Underlying EBIT = Underlying Earnings before interest and tax. The terms EBITDA and EBIT are non-IFRS disclosure and are unaudited. The terms ‘Underlying’ and ‘Restructuring & other items” are defined in the Directors’ report.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

Geographical segments

In presenting information on a geographical basis segment revenue from external customers is by geographical location of customers. Segment assets are attributed based on geographic location of the business unit. Geographical locations are aligned to those reported internally to the Chief Executive Officer (CEO), who is the Group’s chief operating decision maker.

geographical location of customers. Segment assets are attributed based on geographic location of the business unit. Geographical locations are aligned to those reported internally to the Chief Executive Officer (CEO), who is the Group’s chief operating decision maker.	geographical location of customers. Segment assets are attributed based on geographic location of the business unit. Geographical locations are aligned to those reported internally to the Chief Executive Officer (CEO), who is the Group’s chief operating decision maker.
In millions of AUD Consolidated 2023 2022
Africa Asia/Pacific EMENA Americas	Revenues Non- current assets Revenues Non- current assets
	54.5 28.7 45.5 24.2 883.5 812.7 775.8 737.3 514.5 766.0 478.9 648.6 948.4 969.4 792.9 792.2
Total	2,400.9 2,576.8 2,093.1 2,202.3

1b. Earnings per share

	Consolidated	Consolidated
Centsper share	2023	2022
Basic earnings per share	60.23c	39.45c
Diluted earnings per share	59.96c	39.26c
Basic earnings per share from continuing operations	56.88c	38.56c
Diluted earnings per share from continuing operations	56.62c	38.38c
Basic earnings per share from discontinued operations	3.35c	0.89c
Diluted earnings per share from discontinued operations	3.34c	0.89c

BASIC AND DILUTED EARNINGS PER SHARE

The calculations of both basic and diluted earnings per share were based on the profit attributable to equity holders of the Company of $291.2 million profit (2022: $190.5 million).

Accounting policy – Operating segments

The Group determines and presents operating segments based on information that is reported internally to the Chief Executive Officer (CEO), who is the Group’s chief operating decision maker.

An operating segment is a component of the Group that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Group’s other components, and for which discrete financial information is available. An operating segment’s operating results are reviewed regularly by the CEO to make decisions about resources to be allocated to the segment and to assess its performance.

Segment results that are reported to the CEO include items directly attributed to the segment as well as those that can be allocated on a reasonable basis. Underlying EBIT is calculated as earnings before interest, foreign currency gains and losses, and income tax, is non-IFRS and unaudited.

Items not allocated to segments comprise corporate costs, foreign currency gains or losses, amortisation of intangibles and net financing costs before income tax. Inter-segment pricing is determined on an arm’s length basis.

BASIC AND DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS

The calculations of both basic and diluted earnings per share from continuing operations were based on the profit attributable to equity holders of the Company of $275.0 million profit (2022: $186.2 million).

BASIC AND DILUTED EARNINGS PER SHARE FROM DISCONTINUED OPERATIONS

The calculations of both basic and diluted earnings per share from discontinued operations were based on the gain of discontinued operations of $16.2 million profit (2022: $4.3 million).

WEIGHTED AVERAGE NUMBER OF ORDINARY SHARES (BASIC AND DILUTED)

In millions of shares Note	Consolidated 2023 2022
Issued ordinary shares 1 April 4b	483.7 482.4
Weighted average number of ordinary shares 31 March (Basic) Effect of shares issued Dec 2022(DRP)	483.7 482.4 (0.2) 0.5
Effect of potential shares relating to performance rights granted to employees as compensation, but not yet vested Weighted average number of ordinary shares 31 March (Diluted)	483.5 482.9
	2.2 2.3
	485.7 485.2

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

ACCOUNTING POLICY – EARNINGS PER SHARE

The Group presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the period. Diluted EPS is determined by adjusting the profit or loss attributable to ordinary shareholders and the weighted average number of ordinary shares outstanding for the effects of all dilutive potential ordinary shares, which comprise performance and service rights granted to employees.

1c. Revenue

Under AASB 15 revenue is recognised at an amount that reflects the consideration to which an entity expects to be entitled in exchange for transferring services to a customer.

DISAGGREGATION OF REVENUE

Revenue is disaggregated by geographical locations of external customers.

Disaggregation of revenue from continuing operations

In millions of AUD	Consolidated	Consolidated
	2023	2022
Africa	54.5	45.5
Asia/Pacific	764.6	647.2
EMENA	514.5	478.9
Americas	945.7	780.3
Total revenue	2,279.2	1,951.8

ACCOUNTING POLICY – REVENUE

Services rendered

The Group recognises revenue when the amount of revenue can be readily measured, and it is probable that future economic benefits will flow to the Group. AASB 15 establishes a five-step model to account for revenue arising from contracts with customers and requires judgement, taking into consideration all of the relevant facts and circumstances when applying each step of the model to contract with customers.

The Group recognises revenue based on two models: services transferred at a point in time and services transferred over time. The majority of the Group’s customer contracts give rise to short-term projects where revenue is recognised at a point in time. Revenue from these projects is recognised in the profit and loss statement upon completion of the performance obligations, usually when the report of findings or test/inspection certificate is issued. Revenue from these projects is measured according to the transaction price agreed in the contract.

Once services are rendered, the customer is invoiced, and payment is due as per the terms of the agreement, typically between 30-90 days.

For long-term projects, the Group recognise revenue in the profit and loss statement over time. Revenue from these projects is recognised based on the measure of progress. When the Group has a right to consideration from a customer at the amount corresponding directly to the customer’s value of the performance completed to date, revenue is recognised in the amount to which the Group has a right to invoice.

Long-term contract invoices are issued per contractually agreed instalments and prices, with payment due typically between 30-90 days from invoicing.

Dividend Income

Dividend income is recognised in profit and loss on the date that the Group’s right to receive payment is established.

1d. Expenses (continuing operations)

Profit before income tax includes the following specific expenses:

expenses:
In millions of AUD	Note	Consolidated
		2023	2022
Employee expenses		983.9	851.1
Raw materials and consumables		252.2	224.4
Occupancy costs		133.2	109.9
External service costs		62.1	51.2
Equity-settled share-based payment transactions	8a	7.9	5.3
Contributions to defined
contribution post- employment plans – incl in		50.6	42.7
employee expenses above
Loss on sale of property plant and equipment		0.8	7.8
Net (gain)/loss on foreign exchange		(2.4)	(2.6)

ACCOUNTING POLICY – EXPENSES

Finance income and finance expense

Finance income comprises interest income on funds invested and is recognised in the profit and loss statement as it accrues, using the effective interest method.

Finance expense comprises interest expense on borrowings calculated using the effective interest method and gains and losses on hedging instruments that are recognised in the profit and loss statement (see note 4a). The interest expense component of lease payments is recognised in the profit and loss statement using the effective interest method.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

Foreign currency gains and losses

Foreign currency gains and losses are reported on a net basis.

DEFINED CONTRIBUTION SUPERANNUATION FUNDS

Obligations for contributions to defined contribution superannuation funds are recognised as an expense in the profit and loss statement as incurred.

Short-term service benefits

Short-term employee benefits are expensed as the related service is provided. A liability is recognised for the amount expected to be paid if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

Long-term service benefits

The Group’s net obligation in respect of long-term service benefits is the amount of future benefit that employees have earned in return for their service in the current and prior periods. That benefit is discounted to determine its present value. Re-measurements are recognised in the profit or loss in the period in which they arise.

Share-based payment transactions

The grant-date fair value of equity-settled share-based payment arrangements granted to employees is recognised as an expense, with a corresponding increase in equity, over the vesting period of the awards. The amount recognised as an expense is adjusted to reflect the number of awards for which the related service and non-market performance conditions are expected to be met, such that the amount ultimately recognised is based on the number of awards that meet the related service and non-market performance conditions at the vesting date. For share-based payment awards with non-vesting conditions, the grant-date fair value of the share-based payment is measured to reflect such conditions and there is no true-up for differences between expected and actual outcomes.

The fair value of the amount payable to employees in respect of cash-settled share-based awards is recognised as an expense, with a corresponding increase in liabilities, over the period in which the employees become unconditionally entitled to payment. The liability is re-measured to fair value at each reporting date and at settlement date. Any changes in the fair value of the liability are recognised as employee expenses in profit or loss.

1e. Discontinued operations

In millions of AUD	Consolidated 2023 2022
Revenue Amortisation and depreciation Other expenses Results from operations Gain on disposal Interest Profit of discontinued operations Income tax Profit of discontinued operations, net of tax Basic earnings per share from discontinued operations Diluted earnings per share from discontinued operations	121.7 141.3 (6.1) (7.6) (109.8) (130.8)
	5.8 2.9 12.3 - (0.3) (0.5)
	17.8 2.4 (1.6) (1.8)
	16.2 0.6
	3.35 0.89 3.34 0.89

Cash flows from discontinued operations

In millions of AUD	Consolidated 2023 2022
Net cash from operating activities Net cash from investing activities Net cash from financing activities Net cash from discontinued operations	5.2 (0.8) (1.3) (3.9) (4.4 (4.4)
	(0.5) (9.1)

1f. Other expenses

During FY22 the Group repaid and expensed to the profit and loss account net JobKeeper of $3.0 million and net CEWS of $20.4 million, after deducting costs associated with the repayment.

In millions of AUD	Consolidated	Consolidated
	2023	2022
Covid-19 subsidies & grants (repaid)/received,net of costs	-	(23.4)
	-	(23.4)

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

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CAPITAL EMPLOYED: WORKING CAPITAL AND OTHER INSTRUMENTS

This section provides information about the working capital of the Group and key balance sheet items. Where relevant the accounting policies that have been applied and significant estimates and judgements made is included with each note.

2a. Trade and other receivables

2b. Related party transactions

Trade receivables are shown net of allowance for expected credit losses of $8.7 million (2022: $6.3 million) and are all expected to be recovered within 12 months. Expected credit loss allowances on trade receivables charged as part of operating costs was $3.8 million (2022: $1.3 million).

There is no concentration of credit risk with respect to trade receivables. There is no single customer making up a material percentage of the Group’s revenue (refer to note 4a).

2c. Inventories

2d. Trade and other payables

2e. Property, plant & equipment

2f. Investment property

2g. Intangible assets

2h. Other assets and liabilities

2i. Investments accounted for using the equity method

2a. Trade and other receivables

2a. Trade and other receivables
In millions of AUD	Consolidated 2023 2022
Current Trade receivables Other receivables Aging of trade receivables Current 30 days 60 days 90 days and over Total Allowance for expected credit loss Opening balance Write off Movement in provision Closing balance	341.9 321.8 74.7 64.8
	416.6 386.6
	206.8 202.9 91.3 78.2 22.6 22.2 29.9 24.8
	350.6 328.1
	6.3 8.9 (2.3) (4.3) 4.7 1.7
	8.7 6.3

Other receivables of $74.7 million (2022: $64.8 million) largely comprises amounts related to VAT receivable and services completed not contractually invoiced, all within payment terms.

Exposures to currency risks related to trade and other receivables are disclosed in note 4c.

ACCOUNTING POLICY – TRADE AND OTHER RECEIVABLES

Trade receivables are recognised at the value of the original invoice amount to customers less allowance for any non-collectible amounts (amortised cost). Estimates are used in determining the level of receivable that will not be collected. An expected credit loss allowance is made for trade receivable balances in compliance with the simplified approach permitted by AASB 9, by using a provision matrix. The matrix was developed to reflect historic default rates, by region, with higher default rates applied to older balances. The approach is followed for all receivables unless there are specific circumstances, such as significant financial difficulties of the customer or bankruptcy of a customer, which would render the receivable irrecoverable and therefore require a specific provision. A provision is made against trade receivables until such time as the Group believes the amount to be irrecoverable, after which the trade receivable balance is written off. Unbilled revenues are recognised for services completed but not yet invoiced and are valued at net selling price.

2b. Related party transactions

The related party transactions disclosed are transactions with related parties at the time they were considered related parties of the Group. The ultimate parent of the Group is ALS Limited.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

All receivables and payables to and from related parties, except for related party borrowings are made on terms equivalent to those that prevail in arm’s length transactions. There have been no guarantees provided to any related party. For the period ended 31 March 2023, the Group has not recorded any impairment of receivables relating to amounts owed by related parties (2022: nil).

parties (2022: nil).
In thousands AUD			Consolidated
		Sales to
		related	2023	2022
	%	parties*
Australian
Laboratory Services	42%	5,715.5	1,192.4	481.0
Arabia Co. Ltd.
ALS Technichem (M) Sdn Bhd	40%	402.0	290.0	812.1
PT. ALS Indonesia	20%	107.6	96.3	112.8
		6,225.1	1,578.7	1,405.9

includes an appropriate share of overheads based on normal operating capacity.

Cost for incomplete field services works is recognised as work in progress and measured at the lower of cost to date and net realisable value.

2d. Trade and other payables


In millions of AUD	Consolidated 2023 2022
Trade payables Contract liabilities Contingent consideration and deferred payments relating to acquisitions Other payables and accrued expenses	100.7 72.8 38.6 20.7 37.9 63.0 169.1 154.3
	346.3 310.8

* Period ended 31 March 2023

ACCOUNTING POLICY

2c. Inventories

In millions of AUD	Consolidated 2023 2022
Raw materials and consumables Work in progress Finished goods	95.2 64.3 4.9 5.9 1.2 1.0
	101.3 71.2

Work in progress recognised by the Group relates to contractual arrangements (refer to note 1c).

ACCOUNTING POLICY

Inventories are stated at the lower of cost and net realisable value. Net realisable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and selling expenses.

The cost of inventories is based on the weighted average method and includes expenditure incurred in acquiring the inventories, production or conversion costs and other costs incurred in bringing them to their existing location and condition. In the case of manufactured inventories and work in progress, cost

Trade and other payables

Trade and other payables are stated at their amortised cost, except for contingent consideration which is stated at fair value. Trade payables are non-interest bearing and are normally settled on 60-day terms.

Provisions

A provision is recognised in the balance sheet when the Group has a present legal or constructive obligation as a result of a past event, and it is probable that an outflow of economic benefits that can be estimated reliably will be required to settle the obligation. If the effect is material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability. The unwinding of the discount is recognised as a finance cost.

Contract Liabilities

Contract liabilities arise upon advance payments from clients and issuance of upfront invoices.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

2e. Property, plant & equipment

	Freehold land	Plant and	Leasehold	Capital works
In millions of AUD	and buildings	equipment	improvements	in progress	Total
At cost	235.8	826.8	173.3	25.2	1,261.1
Accumulated depreciation	(67.1)	(623.2)	(116.6)	–	(806.9)
Net book amount 1 April 2021	168.7	203.6	56.7	25.2	454.2
Additions	8.0	94.4	10.1	3.4	115.9
Additions through business combinations	1.1	2.1	-	4.2	7.4
Disposals	(1.8)	(4.0)	(0.7)	-	(6.5)
Transfers	0.1	0.1	(0.1)	0.6	0.7
Depreciation expense	(7.1)	(61.4)	(9.4)	-	(77.9)
Exchange differences	(1.6)	1.6	0.5	0.4	0.8
Net book amount 31 March 2022	167.4	236.4	57.1	33.8	494.6
At cost	240.5	878.0	176.8	33.8	1,329.1
Accumulated depreciation	(73.1)	(641.6)	(119.7)	-	(834.5)
Net book amount 1 April 2022	167.4	236.4	57.1	33.8	494.6
Additions	3.9	97.4	10.4	26.8	138.5
Additions through business combinations	5.5	18.1	0.5	0.3	24.4
Disposals	(1.1)	(9.7)	(0.3)	(1.2)	(12.3)
Transfers	(3.7)	2.6	1.4	(4.3)	(4.0)
Depreciation expense	(6.6)	(70.1)	(10.4)	-	(87.1)
Exchange differences	8.5	12.3	4.5	1.5	26.8
Net book amount 31 March 2023	173.7	287.0	63.2	56.9	580.8
At cost	260.2	911.0	180.8	56.9	1,409.0
Accumulated depreciation	(86.4)	(624.0)	(117.6)	-	828.2
Net book amount 31 March 2023	173.7	287.0	63.2	56.9	580.8

ACCOUNTING POLICY – PROPERTY, PLANT & EQUIPMENT

Owned assets

Items of property, plant and equipment are stated at cost less accumulated depreciation and impairment losses.

Cost includes expenditure that is directly attributable to the acquisition of the asset. The cost of self-constructed assets includes the cost of materials and direct labour, any other costs directly attributable to bringing the asset to a working condition for its intended use, the costs of dismantling and removing the items and restoring the site on which they are located, and capitalised borrowing costs. Cost also may include transfers from equity of any gain or loss on qualifying cash flow hedges of foreign currency purchases of property, plant and equipment. Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment.

Where parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items of property, plant and equipment.

Gains and losses on disposal of an item of property, plant and equipment are determined by comparing the proceeds from disposal with the carrying amount of property, plant and equipment and are recognised net within “Other expenses” in the profit and loss statement. When revalued assets are sold, the amounts included in the revaluation reserve are transferred to retained earnings.

Borrowing costs

The Group capitalises borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset as part of the cost of that asset. All other borrowing costs are recognised in the profit and loss using the effective interest method.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

Reclassification to investment property

When the use of a property changes from owneroccupied to investment property, the property is held at cost and reclassified as investment property.

Subsequent costs

The Group recognises in the carrying amount of an item of property, plant and equipment the cost of replacing part of such an item when that cost is incurred if it is probable that the future economic benefits embodied within the item will flow to the Group and the cost of the item can be measured reliably. All other costs are recognised in the profit and loss statement as an expense as incurred.

Depreciation

Depreciation is calculated on the depreciable amount, which is the cost of an asset, or other amount substituted for cost, less its residual value. Depreciation is charged to the profit and loss statement on a straightline or diminishing value basis over the estimated useful lives of each part of an item of property, plant and equipment. Land is not depreciated. The estimated useful lives in the current and comparative periods are as follows:

•	Buildings	20-40 Years
•	Plant and equipment	3-10 Years
•	Leasehold improvements	3-20 Years
•	Leased plant and equipment	4-5 Years

2f. Investment property

2f. Investment property
In millions of AUD	Consolidated 2023 2022
Carrying amount at the beginning of the year Additions Depreciation Carrying amount at end of year	9.9 9.8 - 0.2 (0.1) (0.1)
	9.8 9.9

Investment property comprises a commercial property leased to a third party. The current lease expired in September 2022 and is rolling on a monthly basis while the extension is under negotiation. See note 4f (Leases) for further information.

Fair value of the property is estimated to be $26.0 million (2022: $26.0 million) based on a capitalisation rate of 6.1% (2022: 6.1%).

ACCOUNTING POLICY – INVESTMENT PROPERTY

Investment property is property held either to earn rental income or for capital appreciation or for both. Investment property is measured at cost and is depreciated on a straight-line basis over the estimated useful life.

The residual value, the useful life and the depreciation method applied to an asset are reassessed at least annually and adjusted if appropriate.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

2g. Intangible assets

In millions of AUD	Consolidated
	Goodwill Purchased trademarks & brand names Customer Relationships Technology & Non-Compete Agreements Software Total
Balance 1 April 2021 Additions through business combinations Additions Transfer Amortisation Effect of movements in foreign exchange	1,073.7 0.5 61.2 0.6 15.0 1,151.0 36.2 - 7.5 0.4 - 44.1 - - - - 3.2 3.2 - - - - (0.3) (0.3) - (0.2) (9.1) (0.2) (4.2) (13.7) 8.7 0.1 1.6 (0.1) 0.2 10.5
Balance 31 March 2022 Additions through business combinations Additions Transfer Disposal Amortisation Effect of movements in foreign exchange	1,118.6 0.4 61.2 0.7 13.9 1,194.8
	153.3 0.3 39.6 0.1 0.9 194.2
	- - - - 7.6 7.6
	- - - - (0.9) (0.9)
	(39.8) - - - (1.9) (41.7)
	- - (10.2) (0.2) (4.2) (14.6)
	68.6 - 5.4 0.1 0.4 74.5
Balance 31 March 2023	1,300.7 0.7 96.0 0.7 15.8 1,413.9

IMPAIRMENT TESTS FOR CASH GENERATING UNITS CONTAINING GOODWILL

Calculation of recoverable amounts

The recoverable amount of assets is the greater of their 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 pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For an asset that does not generate largely independent cash inflows, the recoverable amount is determined for the cash-generating unit to which the asset belongs. The goodwill acquired in a business combination, for the purpose of impairment testing, is allocated to cash-generating units that are expected to benefit from the synergies of the combination.

The following cash generating units have significant carrying amounts of goodwill:

Carrying value In millions of AUD	Consolidated 2023 2022
ALS Commodities ALS Life Sciences ALS Industrial	529.2 423.2 771.5 590.0 - 105.4
	1,300.7 1,118.6

On 1 April 2022 the Group implemented a new 5-year Strategic Plan which has facilitated a change in the process to service both its clients and necessitate a reorganisation of management reporting lines to align to the new global service line model. As a result of the reorganisation, the Group revised its CGU’s and changed the level that goodwill is monitored to reflect the information being reviewed by the Chief Operating Decision Maker i.e., ALS Commodities and ALS Life Sciences. The goodwill reallocation was confined within CGU’s such that at a segment level, no change in goodwill carrying values result.

The former ALS Industrial CGU previously comprised both the Asset Care and Tribology business units. With the disposal of the Asset Care business occurring during FY23, the remaining Tribology business was reclassified within ALS Commodities. Refer note 1e.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

The value in use calculations performed for all cash generating units use cash flow projections based on actual operating results, the Board approved budget for FY24, and forecasts drawn from FY25 to FY28 which are based on management’s estimates of underlying economic conditions, past financial results, and other factors anticipated to impact the cash generating units’ performance. The terminal value of all CGU’s has been forecasted using a nominal growth rate of 2.75%.

Terminal growth rates are consistent with the prior year. Directors believe these terminal growth rates are an appropriate estimate of the long-term average growth rates achievable in the industries and geographies in which the Group participates.

Should the short-term projections utilised, or the reestablishment of historical operating metric not eventuate in future periods, impairment may result.

The following nominal pre-tax discount rates have been used in discounting the projected cash flows.

In millions of AUD
ALS Commodities	13.6%
ALS Life Sciences	11.2%

The discount rates used has been supported by independent analysis commissioned by the Group.

The determination of the recoverable amounts of the Group’s cash generating units involves significant estimates and judgements and the results are subject to the risk of adverse and sustained changes in the key markets and/or geographies in which the Group operates. Sensitivity analyses performed indicate a reasonably possible change in any of the key assumptions for the Group’s remaining CGUs would not result in impairment.

ACCOUNTING POLICY – INTANGIBLE ASSETS

Goodwill

Goodwill arising on the acquisition of a subsidiary or business is included in intangible assets.

Subsequent measurement

Goodwill is measured at cost less accumulated impairment losses. In respect of equity accounted investees, the carrying amount of goodwill is included in the carrying amount of the investment.

Other intangible assets

Other intangible assets that are acquired by the Group are stated at cost less accumulated amortisation and impairment losses.

Expenditure on internally generated goodwill and brands is recognised in the profit and loss statement as an expense as incurred.

Subsequent expenditure

Subsequent expenditure on capitalised intangible assets is capitalised only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure is expensed as incurred.

Amortisation

Amortisation is calculated on the cost of an asset less its residual value. Amortisation is charged to the profit and loss statement on a straight-line basis over the estimated useful lives of intangible assets unless such lives are indefinite. Goodwill and intangible assets with an indefinite useful life are systematically tested for impairment at each balance sheet date. Other intangible assets are amortised from the date they are available for use.

The estimated useful lives in the current and comparative periods are as follows:

Capitalised computer software 3-10 Years
• Trademarks and brand names 2-5 Years • Customer relationships & contracts 1-15 Years • Technology & Non-Compete Agreements 4 Years

The residual value, the useful life and the amortisation method applied to an asset are reassessed at least annually and adjusted if appropriate.

2h. Other assets and liabilities

In millions of AUD	Consolidated 2023 2022
Other assets and liabilities Current assets Prepayments Promissory note Other Non-current assets Related party loans Fair value derivative Investments in other corporations Other Current liabilities Income tax Non-current liabilities Related party loans Contingent consideration and deferred payments relating to acquisitions Other	47.4 41.8 - 13.8 8.4 5.7
	55.8 61.3
	1.6 1.4 - 4.8 8.3 7.7 22.8 7.6
	32.7 21.5
	28.6 18.3
	28.6 18.3
	6.2 - 30.1 40.2 3.7 5.2
	40.0 45.4

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

2i. Investments accounted for using the equity method

The Group has a 49% shareholding in both Nuvisan GmbH and Nuvisan ICB GmbH (collectively Nuvisan), both pharmaceutical testing companies with operations in Germany and France. Both entities are private entities not listed on any public exchange. The Group’s interest in Nuvisan is accounted for using the equity method in the consolidated financial statements.

The 49% ownership interest in Nuvisan, and the 51% interest in Nuvisan not owned by the Group, are subject to a put and call option arrangement (the Option). Option exercise dates range from 1 January 2024 to 30 September 2026 and the availability of certain options is subject to 3rd party approval. If exercised, the Option could result in a change in the Group’s ownership interest, including the disposal of Nuvisan ICB GmbH or the purchase of the 51% interest in Nuvisan not already owned; the exercise price under the Option to acquire that interest is 13 times the attributable adjusted EBITDA for the

12-month period preceding the exercise of the option. At 31 March 2023 the Group is under no obligation to pay or receive any amounts under the Option.

The Option is a derivative financial instrument carried at fair value, and at 31 March 2023 was estimated to have a fair value of nil.

The following table illustrates the summarised financial information of the Group’s investment in Nuvisan.


In millions of AUD	2023 2022
Current assets Non-current assets Current liabilities Non-current liabilities Equity Group’s share in equity 49% Goodwill Other intangibles Amortisation of intangibles Deferred tax liability Foreign currency translation reserve Group’s carrying amount of investment Revenue Expenses Other income Financing costs Profit before tax Income tax expense Profit for the year Other comprehensive loss that will not be reclassified to profit or loss in subsequent periods, net of tax Total comprehensive income for year	138.2 139.9 234.4 258.6 (146.0) (140.0) (161.9) (229.0)
	64.7 29.5
	31.7 14.5 169.0 154.4 94.4 86.2 (16.2) (4.9) (23.5) (24.4) 2.5 (3.6)
	257.9 222.2
	289.7 150.6 (291.1) (141.3) 14.1 12.3 (1.2) (0.4)
	11.5 21.2 (1.9) (4.1)
	9.6 17.1 37.2 (0.9)
	46.8 16.2

In millions of AUD	2023 2022
Group’s share of net profit for year at 49% Amortisation of intangibles Group’s share of net (losses)/profit foryear	4.7 8.4 (7.6) (3.5)
	(2.9) 4.9

The associate requires the Group’s consent to distribute its profits.

The Group has a loan payable of $6.2 million (2022: Nil) to Nuvisan as at 31 March 2023.

The associate had no contingent liabilities or capital commitments as at 31 March 2023.

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NET DEBT

This section provides information about the overall debt of the company. Where relevant the accounting policies that have been applied and significant estimates and judgements made is included with each note.

3a. Cash and cash equivalents
3b. Reconciliation of operating profit to net cash
3c. Reconciliation of liabilities arising from financing activities
3d. Loans and borrowings

3a. Cash and cash equivalents

In millions of AUD	Consolidated	Consolidated
	2023	2022
Cash and cash equivalents in the statement of cash flows	179.6	122.8

The Group’s exposure to interest rate risk and a sensitivity analysis for financial assets and liabilities are disclosed in note 4.

ACCOUNTING POLICY – CASH AND CASH EQUIVALENTS

Cash and cash equivalents comprise cash balances and deposits at call. Bank overdrafts that are repayable on demand and form an integral part of the Group’s cash management are included as a component of cash and cash equivalents for the purpose of the statement of cash flows.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

3b. Reconciliation of operating profit to net cash

In millions of AUD	Consolidated 2023 2022
Profit for the period Adjustments for: Amortisation and depreciation Loss on sale of property plant and equipment Accrued interest on deferred consideration Gain on sale of Asset Care Share-settled performance rights amounts recognised during the year Share of associates and joint venture net profit Net non-cash expenses Operating cashflow before changes in working capital and provisions (Increase) in trade and other receivables (Increase)/decrease in inventories Increase/(Decrease) in trade and other payables (Decrease)/increase in taxation provisions Net cash from operating activities	292.5 192.2 158.6 138.9 2.3 3.9 2.2 - (12.3) - (7.2) (11.0) (2.5) (9.0) 15.6 0.7
	449.2 315.7 (40.9) (55.9) (17.9) (7.2) 23.3 50.1 26.2 (15.9)
	439.9 286.8

3c. Reconciliation of liabilities arising from financing activities

In millions of AUD	Long- term notes	Bank loans	Lease liabilities	Total
1-Apr-22	775.5	248.9	213.2	1,237.6
Net cash flows	12.6	95.7	(52.9)	55.4
Non-cash
changes
Acquisition	-	8.5	72.3	80.8
Foreign
exchange	43.8	17.6	13.0	74.4
movements
31-Mar-23	831.9	370.7	245.6	1,448.2

In millions of AUD	Long- term notes	Bank loans	Lease liabilities	Total
1-Apr-21	775.8	6.4	185.5	967.7
Net cash flows	-	253.9	(45.2)	208.7
Non-cash changes
Acquisition	-	-	71.1	71.1
Foreign
exchange	(0.3)	(11.5)	1.8	(10.0)
movements
31-Mar-22	775.5	248.9	213.2	1,237.6

3d. Loans and borrowings

This note provides information about the contractual terms of the Group’s interest-bearing loans and borrowings. For more information about the Group’s exposure to interest rate and foreign currency risk, see note 4a.


In millions of AUD Current Liabilities	Consolidated 2023 2022
Bank loans Long term notes Lease liabilities	128.3 46.0 - 253.7 51.2 42.6
	179.5 342.3
Non-current liabilities
Bank loans Long term notes Lease liabilities	242.4 202.9 831.9 521.8 194.4 170.6
	1,268.7 895.3

BANK LOANS

The Group maintains revolving bank facilities with a group of six banks totalling USD$350.0 million. These bank facilities will mature in May 2024 (USD$200 million) and May 2026 (USD$150 million). Funding available to the Group from these committed undrawn facilities at 31 March 2023 amounted to $336.0 million (2022: $382.3 million).

The Group maintains a separate bullet maturity fixed rate EUR110.0m bank facility. The EUR funds drawn under this facility will mature in September 2024 (EUR31 million) and October 2023 (EUR79 million) respectively.

The Company and seven of its subsidiaries, namely Australian Laboratory Services Pty Ltd, ALS Group Finance Pty Ltd, ALS Canada Limited, ALS Group General Partnership, ALS Group USA Corp, ALS Inspection UK Ltd, and Stewart Holdings Management Ltd are parties to multicurrency term loan facility agreements as borrowers with a number of banks.

The weighted average interest rate (incorporating the effect of interest rate contracts) for all bank loans at balance date is 3.4% (2022: 0.9%).

Under the terms of the agreements, the Company and a number of its wholly owned subsidiaries jointly and severally guarantee and indemnify the banks in relation to each borrower’s obligations.

LONG-TERM NOTES

The Company’s controlled entities Australian Laboratory Services Pty Ltd, ALS Group Finance Pty Ltd, ALS Testing Services Group Inc. and ALS Canada Ltd have issued long-term, fixed rate notes to investors in the US Private Placement market.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

The original issuances occurred in July 2019, November 2020 and again in July 2022. The notes are issued in tranches and denominated in Australian dollars, US dollars, Euros, Pound Sterling and Canadian dollars. The notes mature as follows – due November 2030: $285.3 million, due July 2032: $292.1 million and due July 2034: $254.6 million.

Interest is payable semi-annually to noteholders. The weighted average interest rate (incorporating the effect of interest rate contracts) for all long-term notes at balance date is 3.2% (2022: 3.5%).

Under the terms of the note agreements, the Company and a number of its wholly owned subsidiaries jointly and severally guarantee and indemnify the noteholders in relation to the issuer’s obligations.

ACCOUNTING POLICY – LOANS AND BORROWINGS

Interest-bearing borrowings are recognised initially at fair value less attributable transaction costs. Subsequent to initial recognition, interest-bearing borrowings are stated at amortised cost with any difference between cost and redemption value being recognised in the profit and loss statement over the period of the borrowings on an effective interest basis.

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RISK & CAPITAL MANAGEMENT

This section provides information about the Group’s risk and capital management. Where relevant the accounting policies that have been applied and significant estimates and judgements made is included with each note.

4a. Financial & capital risk management

4b. Capital & reserves

4c. Financial Instruments

4d. Contingencies

4e. Capital commitments

4f. Leases

4a. Financial & capital risk management

RISK MANAGEMENT FRAMEWORK

Identification, measurement and management of risk is a strategic priority for the Group. The provision of goods and services carries a number of diverse risks which may have a material impact on the Group’s financial position and performance. Consequently, the Board has established a comprehensive framework covering accountability, oversight, measurement and reporting to maintain high standards of risk management throughout the Group.

The Group allocates specific roles in the management of risk to executives and senior managers and to the Board. This is undertaken within an overall framework and strategy established by the Board.

The Audit and Risk Committee obtains assurance about the internal control and risk management environment through regular reports from the Risk and Compliance team.

The Group has exposure to the following risks from their use of financial instruments:

Credit risk
Liquidity risk
Market risk

This note presents information about the Group’s exposure to each of the above risks, the Group’s objectives, policies and processes for measuring and managing risk, and the Group’s management of capital.

CREDIT RISK

The Group has an established credit policy and the exposure to credit risk is monitored on an ongoing basis. Credit evaluations are performed on all customers requiring credit over a certain amount. The Group does not require collateral in respect of financial assets. There is no single customer making up a material percentage of the Group’s revenue.

is no single customer making up of the Group’s revenue.	a material	percentage
Geographic concentrations
of trade receivables are:	2023	2022
Australia	23.1%	29.3%
Canada	10.7%	10.3%
USA	13.0%	13.6%
UK	10.5%	9.8%
Other countries	42.8%	36.9%

The maximum exposure to credit risk is represented by the carrying amount of each financial asset, including derivative financial instruments, in the balance sheet.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

Counterparties to transactions involving derivative financial instruments are large Australian and international banks with whom the Group has a signed netting agreement. Management does not expect any counterparty to fail to meet its obligations.

The Group's policy is to provide financial guarantees only to wholly owned subsidiaries. Details of the Deed of Cross Guarantee are provided in note 5c.

LIQUIDITY RISK

The liquidity position of the Group is continuously managed using cash flow forecasts to ensure sufficient liquid funds are available to meet its financial commitments in a timely and cost-effective manner. The Group maintains over $422.5 million available liquidity, 16.4x interest coverage and weighted average debt maturity of 5.8 years as at 31 March 2023.

The Group is party to a number of bilateral debt facility and long-term note agreements which provide funding for acquisitions and working capital (refer to note 3c) and has entered into new additional bilateral revolving bank facilities totalling USD100m (AUD149m) which have been finalised in May 2023 (refer to note 7e). Following the availability of these new facilities, available liquidity available to the Group increases to a revised total of AUD574m, and the proforma weighted average debt maturity for the Group is expected to be 5.3 years.

Note 4c details the repayment obligations in respect of the amount of the facilities and derivatives utilised.

Foreign exchange risk

The Group operates internationally and is exposed to foreign exchange risk arising from various currency exposures.

Foreign exchange risk arises from future purchase and sales commitments and assets and liabilities that are denominated in a currency that is not the functional currency of the respective Group's entities. Measuring the exposure to foreign exchange risk is achieved by regularly monitoring and performing sensitivity analysis on the Group’s financial position.

The Group may enter into forward foreign exchange contracts (FECs) to hedge certain forecast purchase commitments denominated in foreign currencies (principally US dollars). The terms of these commitments are generally less than three months. The amount of forecast purchases is estimated based on current conditions in foreign markets, customer orders, commitments to suppliers and experience.

The Group has borrowed funds in foreign currencies to hedge its net investments in foreign operations. The Group has United States dollar, Canadian dollar, Euro, and Great British Pound Sterling denominated borrowings designated as hedges of the Group’s net investments in subsidiaries with the same functional currencies.

Capital management

Capital comprises equity attributable to equity holders, loans and borrowings and cash and cash equivalents.

MARKET RISK

Interest rate risk

Interest rate risk is the risk that the Group’s financial position and performance will be adversely affected by movements in interest rates. Interest rate risk on cash and short-term deposits is not considered to be a material risk due to the short-term nature of these financial instruments.

The Group’s interest rate risk arises from long-term debt. Floating rate debt exposes the Group to cash flow interest rate risk and fixed rate debt exposes the Group to fair value interest rate risk. Interest rate risk is managed by maintaining an appropriate mix of fixed and floating rate debt. The Group enters into interest rate swaps to manage the ratio of fixed rate debt to floating rate debt. Hedging is undertaken against specific rate exposures only, as disclosed in note 4c.

Capital management involves the use of corporate forecasting models which facilitates analysis of the Group’s financial position including cash flow forecasts to determine the future capital management requirements. Capital management is undertaken to ensure a secure, cost-effective and flexible supply of funds is available to meet the Group’s operating and capital expenditure requirements, including returns to shareholders. The Group monitors gearing and treasury policy breaches and exceptions. The gearing ratio (net debt to net debt plus equity) as at balance date is 42.6% (2022: 44.4%).

The Group maintains a stable capital base from which it can pursue its growth aspirations, whilst maintaining a flexible capital structure that allows access to a range of debt and equity markets to both draw upon and repay capital.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

4b. Capital & reserves

RECONCILIATION OF MOVEMENT IN CAPITAL

RECONCILIATION OF MOVEMENT IN CAPITAL	RECONCILIATION OF MOVEMENT IN CAPITAL
In millions of AUD Consolidated 2023 2022
Issued and paid-up share capital
484,167,684 ordinary shares fully paid (2022: 483,711,344) Movements in ordinary share capital	1,326.1 1,321.0
Balance at beginning of year Shares issued under dividend reinvestment plan (456,340 @ $11.59 per share) 10,418 Net Treasury shares (purchased), vested and issued to employees (2022: - 27503) Balance at end of year	1,321.0 1,304.6 5.3 16.6 (0.2) (0.2)
	1,326.1 1,321.0

As at the end of year, the total number of treasury shares held by the ALS Limited LTI Plan Trust was 63,488 (2022: 53,070). These treasury shares are held by the Trust to meet the Company’s future anticipated equitysettled performance rights obligations in respect of the LTI Plan.

TERMS AND CONDITIONS

Holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote per share at shareholders’ meetings. In the event of winding up of the Company, ordinary shareholders rank after creditors and are entitled to the net proceeds of liquidation.

RESERVES

The foreign currency translation reserve comprises all foreign exchange differences arising from the translation of the financial statements of foreign operations where their functional currency is different to the presentation currency of the reporting entity, as well as from the translation of liabilities or changes in fair value of derivatives that hedge the Company’s net investment in a foreign subsidiary. The employee sharebased awards reserve comprises the cumulative amount, recognised as an employee expense to date, of the fair value at grant date of share-based, share-settled awards granted to employees. Refer to notes 1d and 8a.

Other reserves comprise the effective portion of the cumulative net change in the fair value of cash flow hedging instruments related to hedged transactions that have not yet occurred. In the prior year, it also included amounts arising from the accounting for a put and call option arrangement entered with a noncontrolling interest of a controlled entity.

DIVIDENDS

Dividends recognised in the current year by the Company are:

Company are:
In millions of AUD Cents per share Franked amount (cents)	Total amount Date of payment
2023
Interim 2023 ordinary 20.3 -	98.3 16 Dec 22
Final 2022 ordinary 17.0 5.1	82.2 4 Jul 22
	180.5
2022 Interim 2022 ordinary 15.8 4.7 Final 2021 ordinary 14.6 10.2 Dividend declared after the end of	76.2 17 Dec 21 70.4 5 Jul 21 146.6 the financial year:
Final 2023 ordinary 19.4 1.9	93.9 6 Jul 23

The franked components of all dividends paid or declared since the end of the previous financial year were franked based on a tax rate of 30.0%.

In millions of AUD	Consolidated	Consolidated
Dividend franking account	2023	2022
30% franking credits available to
shareholders of ALS Limited for	(7.8)	(10.9)
subsequent financial years

The above available amounts are based on the balance of the dividend franking account at year-end adjusted for:

franking credits/debits that will arise from the payment/receipt of current tax liabilities/assets.
franking debits that will arise from the payment of dividends recognised as a liability at the year-end.
franking credits that will arise from the receipt of dividends recognised as receivables by the tax consolidated group at the year-end; and
franking credits that the entity may be prevented from distributing in subsequent years.

ACCOUNTING POLICY

Transaction costs

Transaction costs of an equity transaction are accounted for as a deduction from equity, net of any related income tax benefit.

Dividends

Dividends are recognised as a liability in the period in which they are declared.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

4c. Financial Instruments

LIQUIDITY RISK

Contractual maturities for financial liabilities on a gross cash flow basis are analysed below:

CONSOLIDATED

CONSOLIDATED
As at 31 March 2023 In millions of AUD	6 months or less	6 to 12 months	1 to 2 years	2 to 5 years	Over 5 years	Total
Trade and other payables Lease liabilities Long term notes Bank loans Contingent consideration and deferred payments relating to acquisitions Total	346.3	-	-	-	-	346.3
	31.0	27.3	46.4	93.6	80.8	279.1
	13.5	13.5	27.0	80.9	952.0	1,086.9
	6.8	130.6	138.9	108.6	-	385.0
	10.5	27.4	29.0	1.0	-	67.9
	408.2	198.8	241.3	284.1	1,032.8	2,165.2

CONSOLIDATED

As at 31 March 2022

In millions of AUD	6 months or less 6 to 12 months 1 to 2 years 2 to 5 years Over 5 years Total
Trade and other payables Lease liabilities Long term notes Bank loans Contingent consideration and deferred payments relating to acquisitions Total	310.8 - - - - 310.8 26.6 23.3 39.7 79.0 80.1 248.7 260.3 7.8 15.6 46.7 608.6 939.0 2.2 47.6 120.0 90.9 - 260.7 52.8 10.2 38.2 2.0 - 103.2
	652.7 88.9 213.5 218.6 688.7 1,862.4

CURRENCY RISK

The Group’s exposure to foreign currency risk at balance date was as follows, based on notional amounts:

CONSOLIDATED

In millions of AUD	2023
	USD CAD EUR GBP
Trade and other receivables Cash at bank Long term notes Bank loan Trade and other payables Net balance sheet exposure CONSOLIDATED	17.8 - 6.0 1.2
	40.2 2.3 6.5 (2.3)
	(29.9) (27.6) (129.9) (64.6)
	- - (178.6) -
	(2.9) (0.1) (0.6) 0.1
	25.2 (25.4) (296.6) (65.7)

The following exchange rates against the Australian dollar applied at 31 March:

CONSOLIDATED
In millions of AUD	2022 USD CAD EUR GBP 14.2 - 5.8 1.3 22.1 - 2.1 (0.9) USD - (26.7) (118.7) (61.4) CAD - - (163.2) - EUR (1.8) - (0.4) - GBP 34.5 (26.7) (274.4) (61.0)	31 March spot rate 2023 2022 0.66986 0.74906 0.90636 0.93678 0.61579 0.67393 0.54160 0.57034
Trade and other receivables Cash at bank Long term notes Bank loan Trade and other payables Net balance sheet exposure

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SENSITIVITY ANALYSIS

A 10% strengthening of the Australian dollar against the above currencies at 31 March would have increased (decreased) profit before income tax and equity by the amounts shown below. This analysis assumes that all other variables, in particular interest rates, remain constant. The analysis is performed on the same basis for 2022. The sensitivity of equity is calculated by considering the effect of any associated cash flow hedges and hedges of a net investment in foreign operation at 31 March for the effects of the assumed changes of the underlying risk.

In millions of AUD As at 31 March 2023	Consolidated Profit Equity (5.0) 2.7 (0.2) 2.5 (1.1) 28.0 0.1 5.9 (6.2) 39.1	In millions of AUD As at 31 March 2022	Consolidated Profit Equity
USD CAD EUR GBP		USD CAD EUR GBP	(3.1) - - 2.4 - 25.6 - 5.5
			(3.1) 33.5

A 10% weakening of the Australian dollar against the above currencies at 31 March would have increased (decreased) profit before income tax and equity by the amounts shown below. This analysis assumes that all other variables, in particular interest rates, remain constant. The analysis is performed on the same basis for 2022.

In millions of AUD As at 31 March 2023	Consolidated Profit Equity 6.1 (3.3) 0.2 (3.1) 1.3 (34.3) (0.1) (7.2) 7.5 (47.9)	In millions of AUD As at 31 March 2022	Consolidated Profit Equity
USD CAD EUR GBP		USD CAD EUR GBP	3.8 - - (3.0) - (31.3) - (6.8)
			3.8 (41.1)

INTEREST RATE RISK

At the reporting date the interest rate profile of the Group’s interest-bearing financial instruments was:

Consolidated In millions of AUD	2023 2022 2023 2022 Fixed rate instruments Variable rate instruments
Financial assets Financial liabilities	- – 179.6 122.8 (1,205.8) (898.2) (242.3) (339.4)
	(1,205.8) (898.2) (62.7) (216.6)

SENSITIVITY ANALYSIS

Fair value sensitivity analysis for fixed rate instruments

The Group has designated interest rate contracts as hedging instruments under a fair value hedge accounting model in relation to its fixed rate long-term notes. The interest rate contracts swap the fixed interest payable on a portion of the loan notes to variable interest rates for the term of the debt. In accordance with the Group’s accounting policy (refer to note 3c) changes in fair value of the interest rate contracts together with the change in fair value of the debt arising from changes in interest rates are recognised in the profit and loss (to the extent the fair value hedge is effective). In 2023, the change in fair value of interest rate contracts was $nil million (2022: Nil) and was offset in the Group’s profit and loss statement by an equal amount relating to the change in fair value of the hedged risk. A change of 50 basis points in interest rates at the reporting date would not materially impact the Group’s profit and loss before income tax or equity (2022: Nil).

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

Cash flow sensitivity analysis for variable rate instruments

A change of 50 basis points in interest rates at the reporting date would have increased (decreased) profit before income tax and equity by the amounts shown below. This analysis assumes that all other variables, in particular foreign currency rates, remain constant. The analysis is performed on the same basis for 2022.

Consolidated In millions of AUD	As at 31 March 2023 As at 31 March 2022 Profit Equity Profit Equity
Variable rate instruments Cash flow sensitivity (net)	50 bp increase 50 bp decrease 50 bp increase 50 bp decrease 50 bp increase 50 bp decrease 50 bp increase 50 bp decrease (0.3) 0.3 – – (1.1) 1.1 – –
	(0.3) 0.3 – – (1.1) 1.1 – –

Fair values of financial instruments

The Group’s financial assets and liabilities are included in the balance sheet at amounts that approximate fair values with the exception of fixed rate debt which has a fair value of $929.8 million (2022: $898.7 million). The basis for determining fair values is disclosed in note 7c. The fair value at 31 March 2023 of derivative assets (2022: asset) which are the Group’s only financial instruments carried at fair value, was a net loss of $4.8 million (2022: $0.2 million loss) measured using Level 2 valuation techniques as defined in the fair value hierarchy shown in note 7c. The Group does not have any financial instruments that are categorised as Level 1 in the fair value hierarchy.

4d. Contingencies

The directors are of the opinion that there are no material contingent liabilities at 31 March 2023.

4e. Capital commitments

4e. Capital commitments
In millions of AUD	Consolidated
	2023	2022
Capital expenditure commitments
Plant and equipment contracted
but not provided for and payable	26.1	24.6
within one year

4f. Leases

LEASES AS LESSEE

The Group leases many assets including property, vehicles, laboratory and office equipment.

Carrying amounts of the Group’s right-of-use assets and lease liabilities and the movement during the period:

In millions of AUD	Right-of-use assets	Right-of-use assets	Right-of-use assets	Right-of-use assets
	Property	Vehicles	Equipment	Total	Lease liabilities
As at 1 April 2022 Net additions Amortisation Interest Payments FX As at 31 March 2023	159.2 13.3 26.3			198.8	213.2
	42.5 4.6 31.5			78.6	72.3
	(42.5) (8.2) (6.6)			(57.3)
					8.0
					(60.4)
	11.2 0.4 0.0			11.6	12.5
	170.4 10.1 51.2			231.7	245.6
As at 1 April 2021 Net additions Amortisation Interest Payments FX As at 31 March 2022	157.7 16.7 2.7 36.4 5.1 25.6 (36.8) (8.4) (2.0) - - - - - - 1.9 (0.1) -			177.1 67.1 (47.2) - - 1.8	185.5 71.1 - 7.1 (52.3) 1.8
	159.2 13.3 26.3			198.8	213.2

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

The Group recognised rent expense from short-term leases of $4.3 million (2022: $3.6 million) and leases of low-value assets of $1.8 million (2022: $2.8 million) for the year ended 31 March 2023.

Maturity analysis – contractual undiscounted cash flows:

flows:
In millions of AUD	Consolidated 2023 2022
Due up to one year 58.3 49.9 Due between one and five years 140.0 118.7 Due after five years 80.8 80.1 Total undiscounted lease liabilities at period end 279.1 248.7 Lease liabilities included in the balance sheet at period end Current 51.2 42.6 Non-Current 194.4 170.6 245.6 213.2	58.3 49.9 140.0 118.7 80.8 80.1
	279.1 248.7
	245.6 213.2

ACCOUNTING POLICY

At inception of a contract, the Group assesses whether a contract is, or contains, a lease. A contract is, or contains a lease, if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset, the Group assesses whether:

the contract involves the right to use of an identified asset – this may be specified explicitly and should be physically distinct or represent substantially all of the capacity of a physically distinct asset (If the supplier has a substantive substitution right, then the asset is not identified).
the Group has the right to obtain substantially all of the economic benefits from the use of the asset throughout the period of use; and
the Group has the right to direct the use of the asset.

The Group has the right when it has the decisionmaking rights that are most relevant to changing how and for what purpose the asset is used. In rare cases where the decision about how and for what purpose the asset is used is predetermined, the Group has the right to direct the use of the asset if either:

the Group has the right to operate the asset; or
the Group designed the asset in a way that predetermines how and for what purpose it will be used.

At inception or reassessment of a contract that contains a lease component, the Group allocates the consideration in the contract to each lease component on the basis of their relative stand-alone prices.

However, for leases of land and buildings in which it is a lessee, the Group does not separate non-lease components and account for these lease and non-lease components as a single lease component.

Right-of-Use Assets

The Group recognises right-of-use assets at the commencement date of the lease i.e., the date the underlying asset is available for use. Right-of-use assets are measured at cost, less any accumulated amortisation and impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of the rightof-use asset comprises of the initial lease liability amount, initial direct costs incurred when entering in the lease less lease incentives received and an estimate of the costs to be incurred in dismantling and removing the underlying asset and restoring the site on which it is located, to the condition required by the terms and conditions of the lease.

Unless the Group is reasonably certain to obtain ownership of the leased asset at the end of the lease term, the recognised right-of-use assets are amortised on a straight-line basis over the shorter of its estimated useful life and the lease term.

An impairment review is undertaken for any right of use assets that shows indicators of impairment and an impairment loss is recognised against any right of use lease asset that is impaired.

Lease Liabilities

The lease liability is measured at the present value of the fixed and variable lease payments made over the lease term. The lease payments include fixed payments (including in-substance fixed payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts expected to be paid under residual value guarantees. The lease payments also include the exercise price of a purchase option reasonably certain to be exercised by the Group. Lease payments are apportioned between the finance charged and reduction of the lease liability using the incremental borrowing rate at lease commencement date.

Short-term leases and leases of low-value assets

The Group applies the short-term lease recognition exemption to its short-term leases i.e., those leases that have a lease term of 12 months or less from the commencement date and do not contain a purchase option. It also applies the lease of low-value assets recognition exemption to leases that are considered of low value (less than $7,000). Lease payments on short-term leases and leases of low-value assets are recognised as expense on a straight-line basis over the lease term.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

Leases as lessor

The Group leases out its investment property held under operating lease (see note 2f).

During the year ended 31 March 2023 $2.2 million was recognised as rental income in the profit and loss statement (2022: $2.1 million).

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GROUP STRUCTURE

This section provides information about the Group’s structure. Where relevant the accounting policies that have been applied and significant estimates and judgements made is included with each note.

5a. Acquisition of subsidiaries

5b. Global operating entities and ultimate parent

5c. Deed of cross guarantee

5d. Parent entity disclosures

5a. Acquisition of subsidiaries

BUSINESS COMBINATIONS

	Interest	Date	Consideration
2023	Acquired	acquired	paid
HRL Group	100%	Jul 2022	79.7
Servicios de
Ingenieria y	100%	Nov 2022	18.4
Ambiente S.A.S.
Reliance
Clinical Testing	100%	Nov 2022	20.3
Services, Inc.
ALS GoldSpot Discoveries Ltd.	100%	Dec 2022	28.7
Other			51.4
			198.5

Included in trade and other payables and other noncurrent liabilities is contingent consideration of $4.4 million as at 31 March 2023.

In millions of AUD Interest Acquired Date acquired 2022	Consideration
MinAnalytical Laboratory Services Australia Pty Ltd 100% Dec 2021	43.6
Other	13.7
	57.3

Included in trade and other payables and other noncurrent liabilities is deferred and contingent liabilities of $3.4 million as at 31 March 2022. The purchase price allocation was finalised in FY23, which resulted in retrospective reduction in goodwill of $5.1 million, customer relationships of $11.9 million, deferred tax liabilities of $5 million.

HRL Group

HRL Group
In millions of AUD	Fair Value
	2023
Property, plant and equipment	8.4
ROU assets	1.7
Trade and other receivables	4.1
Inventories	0.9
Cash and cash equivalents	1.2
Identifiable intangible assets	12.1
Investment in equity accounted entity	3.3
Trade and other payables	(3.1)
Interest bearing loans and borrowings	(5.3)
Lease liabilities	(1.8)
Deferred tax liability	(3.1)
Employee benefits	(1.1)
Net identifiable assets and liabilities	17.3
Goodwill on acquisition	62.4
Paid in cash	79.7
Cash (acquired)	(1.2)
Net cash outflow	78.5

In July 2022 the Group acquired 100 per cent of the issued capital of HRL Holdings Limited and its controlled entities. The cash purchase consideration was $79.7 million. The acquired net tangible assets were $17.3 million. In addition to the acquired net tangible assets, goodwill (nondeductible for tax) of $62.4 million was recognised.

The acquisition has been accounted for using the acquisition method. The consolidated financial statements include the results of the HRL Group for the eight-month period from the acquisition date.

Directly attributable transaction costs of $2.5 million relating to this acquisition were included in administration and other expenses in the profit and loss statement. In the period to 31 March 2023 the HRL Group contributed revenue of $21.2 million and a net loss after tax of $1.8 million to the consolidated net profit after tax for the year.

The HRL Group was acquired for the purpose of broadening the food and environmental service reach of the Group’s existing Australasian Life Sciences division. The goodwill recognised on acquisition is attributable mainly to skills and technical talent of the acquired business’ workforce and the synergies expected to be achieved from integrating the company into the Group’s existing business. The goodwill is not expected to be deductible for income tax purposes.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

Servicios de Ingenieria y Ambiente S.A.S.

Servicios de Ingenieria y Ambiente S.A.S.	Servicios de Ingenieria y Ambiente S.A.S.
In millions of AUD Fair Value 2023*
Property, plant and equipment 2.4
Trade and other receivables 3.7
Cash and cash equivalents 0.8
Deferred tax asset 0.3
Trade and other payables (1.7)
Lease liabilities (1.9)
Employee benefits (0.1)
Net identifiable assets and liabilities 3.5
Intangibles on acquisition 14.8
Total consideration 18.4
Deferred consideration (4.4)
Paid in cash 14.0
Cash (acquired) (0.8)
Net cash outflow 13.2

* This acquisition has been recognised on a provisional basis. In November 2022 the Group acquired 100 per cent of the issued capital of Servicios de Ingenieria y Ambiente S.A.S. The cash purchase consideration was $14.0 million. The acquired net tangible assets were $3.5 million. In addition to the acquired net tangible assets, goodwill (nondeductible for tax) of $14.8 million was recognised.

The acquisition has been accounted for using the acquisition method. The consolidated financial statements include the results of Servicios de Ingenieria y Ambiente S.A.S. for the five-month period from the acquisition date. All acquired amounts and contingent consideration was recorded on a provisional basis at 31 March 2023.

Directly attributable transaction costs of $0.2 million relating to this acquisition were included in administration and other expenses in the profit and loss statement. In the period to 31 March 2023 Servicios de Ingenieria y Ambiente S.A.S. contributed revenue of $4.7 million and a net profit after tax of $0.7 million to the consolidated net profit after tax for the year.

Servicios de Ingenieria y Ambiente S.A.S. was acquired for the purpose of broadening the environmental service reach of the Group’s existing Latin American Life Sciences division. The goodwill recognised on acquisition is attributable mainly to skills and technical talent of the acquired business’ workforce and the synergies expected to be achieved from integrating the company into the Group’s existing business. The goodwill is not expected to be deductible for income tax purposes.

Reliance Clinical Testing Services, Inc.

Reliance Clinical Testing Services,	Inc.
In millions of AUD	Fair Value*
	2023
Trade and other receivables	0.9
Cash and cash equivalents	3.2
Tax liability	(0.6)
Trade and other payables	(0.4)
Net identifiable assets and liabilities	3.1
Intangibles on acquisition	17.2
Total consideration	20.3
Deferred consideration	(3.1)
Paid in cash	17.2
Cash (acquired)	(3.2)
Net cash outflow	14.0

* This acquisition has been recognised on a provisional basis. In November 2022 the Group acquired 100 per cent of the issued capital of Reliance Clinical Testing Services, Inc. The cash purchase consideration was $17.2 million. The acquired net tangible assets were $3.1 million. In addition to the acquired net tangible assets, goodwill (non-deductible for tax) of $17.2 million was recognised.

The acquisition has been accounted for using the acquisition method. The consolidated financial statements include the results of Reliance Clinical Testing Services, Inc. for the four-month period from the acquisition date. All acquired amounts and contingent consideration was recorded on a provisional basis at 31 March 2023.

Directly attributable transaction costs of $0.9 million relating to this acquisition were included in administration and other expenses in the profit and loss statement. In the period to 31 March 2023 Reliance Clinical Testing Services, Inc. contributed revenue of $2.4 million and a net profit after tax of $0.7 million to the consolidated net profit after tax for the year.

Reliance Clinical Testing Services, Inc. was acquired for the purpose of broadening the pharma service reach of the Group’s existing North American Life Sciences division. The goodwill recognised on acquisition is attributable mainly to skills and technical talent of the acquired business’ workforce and the synergies expected to be achieved from integrating the company into the Group’s existing business. The goodwill is not expected to be deductible for income tax purposes.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

ALS GoldSpot Discoveries Ltd.
In millions of AUD	Fair Value*
	2023
Property, plant and equipment	1.7
ROU assets
Trade and other receivables	1.8
Inventories
Cash and cash equivalents	0.3
Tax assets
Trade and other payables	(0.6)
Lease liabilities
Employee benefits	(0.2)
Net identifiable assets and liabilities	3.1
Intangibles on acquisition	25.7
Total consideration	28.7
Deferred consideration	(2.7)
Paid in cash	26.0
Cash (acquired)	(0.3)
Net cash outflow	25.7

* This acquisition has been recognised on a provisional basis. In December 2022 the Group acquired ALS GoldSpot Discoveries Ltd. The cash purchase consideration was $26.0 million. The acquired net tangible assets were $3.1 million. In addition to the acquired net tangible assets, goodwill (non-deductible for tax) of $25.7 million was recognised.

The acquisition has been accounted for using the acquisition method. The consolidated financial statements include the results of ALS GoldSpot Discoveries Ltd for the three-month period from the acquisition date. All acquired amounts and contingent consideration was recorded on a provisional basis at 31 March 2023.

Directly attributable transaction costs of $0.8 million relating to these acquisitions were included in administration and other expenses in the profit and loss statement. In the period to 31 March 2023 ALS GoldSpot Discoveries Ltd. contributed revenue of $2.7 million and a net loss after tax of $0.5 million to the consolidated net profit after tax for the year.

ALS GoldSpot Discoveries Ltd was acquired for the purpose of broadening the consulting service reach of the Group’s existing North American Commodities division. The goodwill recognised on acquisition is attributable mainly to skills and technical talent of the acquired business’ workforce and the synergies expected to be achieved from integrating the company into the Group’s existing business. The goodwill is not expected to be deductible for income tax purposes.

Other acquirees’ net assets at	acquisition dates
In millions of AUD	Fair Value*	Fair Value
	2023	2022
Property, plant and equipment	10.0	7.6
ROU assets	0.2	25.3
Trade and other receivables	4.8	8.7
Inventories	1.9	0.5
Cash and cash equivalents	1.5	1.9
Identifiable intangible assets	0.1	-
Tax assets/(liabilities)	-	2.1
Employee benefits	(0.6)	(1.3)
Interest bearing liabilities	(3.2)	-
Trade and other payables	(3.8)	(3.7)
Lease liabilities	(0.5)	(27.2)
Net identifiable assets and
liabilities	10.4	13.7
Intangibles on acquisition	44.7	43.4
Total consideration	55.1	57.3
Contingent consideration	(10.3)	(3.6)
Paid in cash	44.8	53.7
Cash (acquired)	(1.5)	(1.9)
Net cash outflow	43.3	51.8

* These acquisitions have been recognised on a provisional basis. Directly attributable transaction costs of $3.1 million (2022: $1.5 million) relating to these acquisitions were included in administration and other expenses in the profit and loss statement. In the period to 31 March 2023 the other acquirees contributed revenue of $18.1 million (2022: $1.5 million) and a net profit after tax of $1.0 million (2022: $0.1 million) to the consolidated net profit after tax for the year.

The goodwill recognised on acquisition is attributable mainly to skills and technical talent of the acquired business’ workforce and the synergies expected to be achieved from integrating the company into the Group’s existing business.

ACCOUNTING POLICY – BUSINESS COMBINATIONS

Business combinations are accounted for using the acquisition method as at the acquisition date, which is the date on which control is transferred to the Group.

The Group measures goodwill at the acquisition date as:

the fair value of the consideration transferred; plus
the recognised amount of any non-controlling interests in the acquiree; plus
if the business combination is achieved in stages, the fair value of the existing equity interest in the acquiree; less
the net recognised amount (generally fair value) of the identifiable assets acquired and liabilities assumed.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

When the excess is negative, a bargain purchase gain is recognised immediately in profit and loss. The consideration transferred does not include amounts related to the settlement of pre-existing relationships. Such amounts are generally recognised in profit or loss.

Transaction costs related to the acquisition, other than those associated with the issue of debt or equity securities, that the Group incurs in connection with a business combination are expensed as incurred.

Any contingent consideration payable is recognised at fair value at the acquisition date. If the contingent consideration is classified as equity, it is not remeasured, and settlement is accounted for within equity. Otherwise, subsequent changes to the fair value of the contingent consideration are recognised in profit and loss. When share-based payment awards (replacement awards) are required to be exchanged for awards held by the acquiree’s employees (acquiree’s awards) and relate to past services, then all or a portion of the amount of the acquirer’s replacement awards is included in measuring the consideration transferred in the business combination.

This determination is based on the market-based value of the replacement awards compared with the marketbased value of the acquiree’s awards and the extent to which the replacement awards relate to past and/or future service.

In determining the fair value of identifiable net assets acquired, the Group considers the existence of identifiable intangible assets such as brand names, trademarks, customer contracts and relationships and in process research and development intangible assets. Where material, these items are recognised separately from goodwill.

5b. Global operating entities and ultimate parent

The controlled entities disclosed are limited to those entities with a contribution to Group consolidated revenue of at least 1.0%, but also includes the main operating legal entity in every country where the Group has permanent operations, even where such legal entity represents less than 1.0% of the Group consolidated revenues. The list also includes major borrowers but excludes dormant and pure sub-holding entities.

Country	Parent entity
Australia	ALS Limited
Controlled entities
Argentina	ALS Argentina S.A.
Australia	ACIRL Proprietary Ltd
Australia	ACIRL Quality Testing Services Pty Ltd
Australia	ALS Metallurgy Pty Ltd ATF Ammtec Unit Trust
Australia	Australian Laboratory Services Pty Ltd
Australia	ALS Water and Hydrographics Pty Ltd
Australia	MinAnalytical Laboratory Services Australia Pty Ltd
Bolivia	ALS Bolivia Ltda
Botswana	ALS Laboratory Botswana (Pty) Ltd
Brazil	ALS AMBIENTAL Ltda
Burkina Faso	ALS Burkina SARL
Cambodia	Australian Laboratory Services (ALS) (Cambodia) Co., Ltd.
Canada	ALS Canada Ltd.
Chile	ALS Patagonia S.A.
China	ALS Chemex (Guangzhou) Ltd
Colombia	ALS Life Sciences Colombia S.A.S.
Czech Republic	ALS Czech Republic s.r.o.
Denmark	ALS Denmark AS
Dominican Republic	ALS Dominican Republic SAS
Ecuador	ALS ECUADOR ALSECU S.A.
Egypt	Australian Laboratory Services Company
England	ALS Inspection UK Limited
England	ALS Laboratories (UK) Ltd
Ethiopia	ALS Services PLC
Finland	ALS Finland OY
Germany	Invitek Molecular GmbH
Ghana	ALS Ghana Limited
Greenland	ALS Greenland ApS
Hong Kong	ALS Technichem (HK) Pty Ltd
India	ALS Testing Services India Private Limited
Ireland	OMAC Laboratories Limited
Italy	ALS Italia S.r.l.
Ivory Coast	ALS Ivory Coast SARL
Kazakhstan	ALS KazLab LLP
Laos	Australian Laboratory Services (Lao) Ltd
Mali	Group de Laboratoire ALS MALI SARL
Mexico	ALS Chemex de Mexico S.A. de C.V.
Mexico	Laboratorio de Control ARJ, S. A. de C. V.
Mongolia	ALS Group LLC

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FOR THE YEAR ENDED 31 MARCH 2023

Controlled entities	Controlled entities
Mozambique	ALS Inspection Mozambique Service, LDA
Myanmar	ALS Testing Services Company Limited
Namibia	ALS Laboratory Namibia (Proprietary) Ltd
Netherlands	ALS Inspection Netherlands BV
New Zealand	Analytica Laboratories Limited
Norway	ALS Laboratory Group Norway AS
Panama	ALS Panama S.A.
Peru	ALS LS PERU S.A.C.
Peru	ALS Peru S.A.
Poland	ALS Food & Pharmaceutical Polska Sp. z.o.o.
Portugal	ALS Life Sciences Portugal, SA
Romania	ALS Romania S.R.L
Russia	ALS Chita Laboratory LLC
Scotland	ALS Petrophysics Limited
Senegal	ALS Senegal SUARL
Serbia	ALS Laboratory Services DOO BOR
Singapore	ALS Technichem (S) Pte Ltd
Slovakia	ALS SK, s.r.o.
South Africa	ALS Chemex South Africa (Proprietary) Ltd
South Korea	ALS Inspection South Korea Limited
Spain	Aquimisa S.L.
Sudan	Australian Laboratory Services Co. Ltd.
Suriname	Australian Laboratory Services Suriname N.V.
Sweden	ALS Scandinavia AB
Thailand	ALS Laboratory Group (Thailand) Co Ltd
Turkey	ALS Laboratory Services Limited Sirketi
USA	ALS Group USA, Corp
USA	ALS Services USA, Corp
USA	ALS Testing Services Group USA
USA	ALS USA Inc
Uzbekistan	ALS Testing Toshkent LLC
Zambia	Australian Laboratory Group (Zambia) Limited

The above entities were wholly owned at the end of the reporting period.

ACCOUNTING POLICY – CONSOLIDATED ENTITIES Subsidiaries

Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to or has rights to variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases. The accounting policies of subsidiaries have been changed when necessary to align them with the policies adopted by the Group. Associates and joint ventures Associates are those entities in which the Group has significant influence, but not control, over the financial and operating policies. Joint ventures are those entities over whose activities the Group has joint control, whereby the Group has rights to the net assets of the arrangement, rather than rights to its assets and obligations for its liabilities. Interests in associates and joint ventures are accounted for using the equity method. They are recognised initially at cost, which includes transaction costs. Subsequent to initial recognition, the consolidated financial statements include the Group’s share of the profit or loss and OCI of equity accounted investees, until the date on which significant influence or joint control ceases. Non-controlling interests

Acquisitions of non-controlling interests are accounted for as transactions with owners in their capacity as owners and therefore no goodwill is recognised as a result of such transactions. The adjustments to noncontrolling interests are based on a proportionate amount of the net assets of the subsidiary.

Changes in the Group’s interest in a subsidiary that do not result in a loss of control are accounted for as transactions with owners in their capacity as owners. Adjustments to non-controlling interest are based on a proportionate amount of the net assets of the subsidiary. No adjustments are made to goodwill and no gain or loss is recognised in profit or loss.

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FOR THE YEAR ENDED 31 MARCH 2023

Transactions eliminated on consolidation

Intra-group balances and any unrealised gains and losses or income and expenses arising from intra-group transactions, are eliminated in preparing the consolidated financial statements.

The subsidiaries subject to the Deed are:
ACIRL Proprietary Limited
ACIRL Quality Testing Services Pty Ltd
ALS Group Finance Pty Ltd
ALS Industrial Australia Pty Ltd

Unrealised gains arising from transactions with associates and joint ventures are eliminated to the extent of the Group’s interest in the entity with adjustments made to the “Investments accounted for using the equity method” and “Share of net profit of associates and joint ventures accounted for using the equity method” accounts.

5c. Deed of cross guarantee

Pursuant to ASIC Corporations (Wholly owned Companies) Instrument 2016/785 dated 28 September 2016, the wholly owned subsidiaries listed below are relieved from the Corporations Act 2001 requirements for preparation, audit and lodgement of financial reports, and directors’ reports.

It is a condition of the Class Order that the Company and each of the subsidiaries enter into a Deed of Cross Guarantee. The effect of the Deed is that the Company guarantees to each creditor payment in full of any debt in the event of winding up of any of the subsidiaries under certain provisions of the Corporations Act 2001. If a winding up occurs under other provisions of the Act, the Company will only be liable in the event that after six months any creditor has not been paid in full. The subsidiaries have also given similar guarantees in the event that the Company is wound up.

ALS Industrial Holdings Pty Ltd
ALS Industrial Power Services Pty Ltd
ALS Metallurgy Holdings Pty Ltd
ALS Metallurgy Pty Ltd
ALS Metallurgy Pty Ltd atf Ammtec Unit Trust
ALS Russian Holdings Pty Ltd
ALS South American Holdings Pty Ltd
ALS Water and Hydrographics Pty Ltd
Australian Laboratory Services Pty Ltd
HRL Holdings Ltd
Marc Technologies Pty Ltd
Marc Technologies Pty Ltd atf Marc Unit Trust
MinAnalytical Laboratory Services Australia Pty Ltd
OCTFOLIO Pty Ltd
OCTIEF Pty Ltd

A consolidated profit and loss statement, consolidated statement of comprehensive income and consolidated balance sheet, comprising the Company and subsidiaries which are a party to the Deed, after eliminating all transactions between parties to the Deed of Cross Guarantee, at 31 March 2023 is set out on the next page.

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FOR THE YEAR ENDED 31 MARCH 2023

Summary profit and loss statement and retained profits

and retained profits
In millions of AUD	Consolidated 2023 2022
Profit before tax Income tax expense Profit after tax Retained profits at beginning of year Retained earnings adjustment35 Dividends recognised during the year Retained profits at end of year	143.8 189.5 (17.8) (24.9)
	126.0 164.6 (3.9) (17.0) (16.9) - (183.7) (151.5)
	(78.5) (3.9)


Statement of comprehensive income In millions of AUD	Consolidated 2023 2022
Profit for the period Total comprehensive income for the period	126.0 164.6
	126.0 164.6

BALANCE SHEET

In millions of AUD	Consolidated 2023 2022
Assets
Cash and cash equivalents Trade and other receivables Inventories Other Total current assets Receivables Investments accounted for using the equity method Investment property Deferred tax assets Property, plant and equipment Right-of-use assets Intangible assets Other investments Total non-current assets Total assets	37.0 24.4 115.1 121.4 9.4 11.9 11.3 12.5
	172.8 170.2
	202.2 175.2 22.0 18.7 9.8 9.9 35.8 30.2 164.5 160.4 76.5 57.7 362.4 326.3 1,603.8 1,500.0
	2,477.0 2,278.4
	2,649.9 2,448.6
Liabilities
Trade and other payables Loans and borrowings Income tax payable Employee benefits Total current liabilities Loans and borrowings	69.1 90.5 16.8 12.0 10.7 (3.4) 31.0 38.4
	127.6 137.5
	1,250.5 969.1

Employee benefits Other Total non-current liabilities Total liabilities Net assets Equity Share capital Reserves Retained earnings Total equity	4.1 5.2 13.8 14.1
	1,268.4 988.4
	1,396.0 1,125.9
	1,253.9 1,322.7

	1,326.1 1,321.0
	6.3 5.6
	(78.5) (3.9)
	1,253.9 1,322.7

5d. Parent entity disclosures

Result of parent entity

*Result of parent entity*
In millions of AUD	2023 2022
Profit for the period 162.1 133.5 Total comprehensive income for the period 162.1 133.5 *Financial position of parent entity at year end* In millions of AUD 2023 2022	162.1 133.5
	162.1 133.5
Current assets 20.8 30.3 Total assets 1,988.6 1,994.9 Current liabilities 20.3 11.4 Total liabilities 708.6 699.0 Net assets 1,280.0 1,295.9 Share capital 1,326.1 1,321.0 Reserves 6.2 5.4 Retained earnings (52.3) (30.5) Total equity 1,280.0 1,295.9 *Parent entity capital commitments* In millions of AUD 2023 2022 Plant and equipment contracted but not provided for and payable within one year - 0.7 - 0.7	20.8 30.3 1,988.6 1,994.9
	20.3 11.4 708.6 699.0
	1,280.0 1,295.9
	1,326.1 1,321.0 6.2 5.4 (52.3) (30.5)
	1,280.0 1,295.9
	- 0.7

Parent entity guarantees in respect of the debts of its subsidiaries

The Company is party to a number of financing facilities and a Deed of Cross Guarantee under which it guarantees the debts of a number of its subsidiaries. Refer to notes 3d and 5c for details.

35 Represents amounts taken directly to retained earnings

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

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TAXATION

This section provides information about the Group’s income tax expense (including a reconciliation of income tax expense to accounting profit), deferred tax balances and income tax recognised directly in equity. Where relevant the accounting policies that have been applied and significant estimates and judgements made is included with each note.

6a. Income taxes

6b. Deferred tax assets and liabilities

6a. Income taxes

In millions of AUD Recognised in the profit and loss statement	Consolidated 2023 2022
Current tax expense
Current year Adjustments for prior years Deferred tax expense Origination and reversal of temporary differences Total income tax expense in profit and loss statement Reconciliation between tax expense and pre-tax net profit/(loss)	101.8 98.2 2.9 1.0
	104.7 99.2 9.7 (10.8)
	114.4 88.4
Profit/(loss) before tax Income tax using the domestic corporation tax rate of 30% (2022: 30%) Difference resulting from different tax rates in overseas countries Increase in income tax expense due to:	390.7 280.0
	117.2 84.0 (14.3) (8.3)
	102.9 75.7

Non-deductible expenses Non-deductible new market expansion and acquisition related costs Tax losses of subsidiaries not recognised Non-resident withholding tax paid upon receipt of distributions from foreign related parties Non-deductible amortisation of intangibles Under / (over) provided in prior years Decrease in income tax expense due to:	3.4 3.7 1.2 0.8 0.5 5.8 4.7 4.5 1.4 1.7 2.9 1.0
	14.1 17.5

Previously unrecognised tax losses utilised during the year Share of associate entities net profit Foreign statutory tax exemptions granted Tax exempt revenues Income tax expense on pre-tax net profit/(loss) Deferred tax recognised directly in equity	(0.2) - (0.8) (2.7) - (0.4) (1.6) (1.7)
	(2.6) (4.8)

	114.4 88.4

Relating to hedging reserve	1.4 0.1 1.4 0.1

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6b. Deferred tax assets and liabilities

RECOGNISED DEFERRED TAX ASSETS AND LIABILITIES

Deferred tax assets and liabilities are attributable to the following:

RECOGNISED DEFERRED TAX ASSETS AND LIABILITIES Deferred tax assets and liabilities are attributable to the following:
Consolidated	Assets Liabilities
In millions of AUD	2023 2022 2023 2022
Property, plant and equipment Unrealised FX losses/(gains) Provisions and other payables Intangible assets Unearned Revenue Fair value derivatives Inventories Other items Tax value of loss carry-forwards recognised Gross deferred tax assets / liabilities Set off of tax Net deferred tax assets / liabilities	9.3 4.8 25.7 8.2 12.9 4.0 2.4 4.5 28.6 32.2 0.5 0.5 - - 26.9 13.7 3.1 3.1 - - - - - 2.7 - - 2.7 3.9 15.9 11.5 12.2 10.0 2.4 3.5 - -
	72.2 59.1 70.4 43.5 (47.9) (17.3) (47.9) (17.3)
	24.3 41.8 22.5 26.2

Unrecognised deferred tax assets

Deferred tax assets have not been recognised in respect of the following items:

In millions of AUD	Consolidated 2023 2022
Tax losses	40.7 45.1

Deferred tax assets have not been recognised in respect of these items because it is not probable that future taxable profit will be available against which the Group can utilise the benefits.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

ACCOUNTING POLICY

Income taxes

Income tax on the profit or loss for the year comprises current and deferred tax. Income tax is recognised in the profit and loss statement except to the extent that it relates to items recognised directly in equity or other comprehensive income, in which case it is recognised in equity or other comprehensive income, respectively.

Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantially enacted at the balance sheet date, and any adjustment to tax payable in respect of previous years.

Deferred tax is provided using the balance sheet method, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. The following temporary differences are not provided for: initial recognition of goodwill, the initial recognition of assets or liabilities that affect neither accounting nor taxable profit (except for transactions that, on initial recognition, give rise to equal taxable and deductable temporary differences such as recognition of an ROU Asset and a lease liability), and differences relating to investments in subsidiaries to the extent that they will probably not reverse in the foreseeable future. The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantively enacted at the balance sheet date.

A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against which the asset can be utilised. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realised.

Additional income taxes that arise from the distribution of dividends are recognised at the same time as the liability to pay the related dividend.

Tax consolidation

The Company and its wholly owned Australian resident entities have formed a tax-consolidated group with effect from 1 April 2003 and are therefore taxed as a single entity from that date. The head entity within the tax-consolidated group is ALS Limited.

Nature of tax funding arrangements

The head entity, in conjunction with other members of the tax-consolidated group, has entered into a tax funding arrangement which sets out the funding obligations of members of the tax-consolidated group in respect of tax amounts. The tax funding arrangements require payments to/from the head entity equal to the current tax liability (asset) assumed by the head entity and any tax-loss deferred tax asset assumed by the head entity, resulting in the head entity recognising an interentity payable (receivable) equal in amount to the tax liability (asset) assumed. The inter-entity payables (receivables) are at call.

Contributions to fund the current tax liabilities are payable as per the tax funding arrangement and reflect the timing of the head entity’s obligation to make payments for tax liabilities to the relevant tax authorities.

Goods and services tax

Revenue, expenses and assets are recognised net of the amount of goods and services tax (GST), except where the amount of GST incurred is not recoverable from the taxation authority. In these circumstances, the GST is recognised as part of the cost of acquisition of the asset or as part of the expense.

Receivables and payables are stated with the amount of GST included. The net amount of GST recoverable from, or payable to, the taxation authority is included as a current asset or liability in the balance sheet.

Cash flows are included in the statement of cash flows on a gross basis. The GST components of cash flows arising from investing and financing activities which are recoverable from, or payable to, the taxation authority, are classified as operating cash flows.

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

USE OF ESTIMATES AND JUDGEMENTS

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OTHER INFORMATION

This section provides information on items that are not considered to be significant in understanding the financial performance and position of the Group but must be disclosed to comply with the Accounting Standards, the Corporation Act 2001 or the Corporations Regulations.

7a. Basis of preparation

7b. Significant accounting policies

7c. Determination of fair value

7d. Auditor’s remuneration

7e. Events subsequent to balance date

7a. Basis of preparation

STATEMENT OF COMPLIANCE

The financial report is a general-purpose financial report which has been prepared in accordance with Australian Accounting Standards (“AASBs”) adopted by the Australian Accounting Standards Board (“AASB”) and the Corporations Act 2001. The consolidated financial report of the Group also complies with the International Financial Reporting Standards (IFRSs) adopted by the International Accounting Standards Board.

The financial report was authorised for issue by the directors on 29 May 2023.

GOING CONCERN

The financial statements have been approved by the Directors on a going concern basis.

The preparation of a financial report requires judgements, estimates and assumptions to be made, affecting the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised 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.

In particular, the most significant uses of estimates and judgements are described in notes 2a Trade and other receivables, 2g Intangible assets, 4f Lease, 5a Acquisition of subsidiaries, 6a Income taxes and 6b Deferred tax assets and liabilities.

COMPARATIVES

Certain comparative balances have been represented due to discontinued operations.

7b. Significant accounting policies

The accounting policies applied by the Group in this Financial report are the same as those applied by the Group in its consolidated financial report as at and for the year ended 31 March 2023.

Accounting policies that apply to specific content in the financial statements have been included within the relevant notes.

BASIS OF MEASUREMENT

The financial report is prepared on the historical cost basis except that derivative financial instruments and liabilities for cash-settled share-based payments are measured at fair value.

Accounting policies that apply across a number of contents in the financial statements are listed below.

IMPAIRMENT

Financial assets

FUNCTIONAL AND PRESENTATION CURRENCY

The financial report is presented in Australian dollars which is the Company’s functional currency. The Company is of a kind referred to in ASIC Corporations (Rounding in Financial/Directors’ reports) Instrument 2016/191 dated 24 March 2016 and in accordance with that Instrument, amounts in the Financial report have been rounded off to the nearest hundred thousand dollars, unless otherwise stated.

The Group’s primary type of financial assets subject to AASB 9’s expected credit loss model is trade receivables. The Group has applied the simplified approach permitted in AASB 9, which requires the use of the lifetime expected loss provision for all receivables, whereas AASB 139 operated under an incurred loss model and would only recognise impairments when there was objective evidence.

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An impairment loss in respect of a financial asset measured at amortised cost is calculated as the difference between its carrying amount, and the present value of the estimated future cash flows discounted at the original effective interest rate. An impairment loss in respect of an available-for-sale financial asset is calculated by reference to its fair value.

Individually significant financial assets are tested for impairment on an individual basis. The remaining financial assets are assessed collectively in groups that share similar credit risk characteristics.

All impairment losses are recognised in the profit and loss statement.

An impairment loss is reversed if the reversal can be related objectively to an event occurring after the impairment loss was recognised. For financial assets measured at amortised cost, the reversal is recognised in the profit and loss statement.

Non-financial assets

The carrying amounts of the Group’s non-financial assets, other than inventories (see note 2c) and deferred tax assets (see note 6b), are reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indication exists, the asset’s recoverable amount is estimated. For goodwill, assets that have an indefinite useful life and intangible assets that are not yet available for use, the recoverable amount is estimated at each balance sheet date.

An impairment loss is recognised whenever the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount. Impairment losses are recognised in the profit and loss statement, unless an asset has previously been revalued, in which case the impairment loss is recognised as a reversal to the extent of that previous revaluation with any excess recognised through the profit and loss statement.

Impairment losses recognised in respect of cashgenerating units are allocated first to reduce the carrying amount of any goodwill allocated to cashgenerating units (group of units) and then, to reduce the carrying amount of the other assets in the unit (group of units) on a pro rata basis.

Goodwill that forms part of the carrying amount of an investment in equity accounted investees is not recognised separately, and therefore is not tested for impairment separately. Instead, the entire amount of the investment is tested for impairment as a single asset when there is objective evidence that the investment may be impaired.

HEDGING

Cash flow hedges

Where a derivative financial instrument is designated as a hedge of the variability in cash flows of a recognised asset or liability, or a highly probable forecast transaction, the effective portion of any gain or loss on the derivative financial instrument is recognised in other comprehensive income and presented in the hedging reserve in equity. When the forecast transaction subsequently results in the recognition of a non-financial asset or non-financial liability, or the forecast transaction for a non-financial asset or non-financial liability, the associated cumulative gain or loss is transferred from other comprehensive income and included in the initial cost or other carrying amount of the non-financial asset or liability. In other cases, the amount recognised in other comprehensive income is transferred to the profit and loss statement in the same period that the hedged item affects profit or loss.

The ineffective portion of any change in fair value is recognised immediately in the profit and loss statement.

When a hedging instrument expires or is sold, terminated or exercised, or the entity revokes designation of the hedge relationship, but the hedged forecast transaction is still expected to occur, the cumulative gain or loss at that point remains in equity and is recognised in accordance with the above policy when the transaction occurs. If the hedged transaction is no longer expected to take place, the cumulative unrealised gain or loss recognised in other comprehensive income is recognised immediately in the profit and loss statement.

Fair value hedges

Changes in the fair value of a derivative hedging instrument designated as a fair value hedge are recognised in the profit or loss. The hedged item also is stated at fair value in respect of the risk being hedged; the gain or loss attributable to the hedged risk is recognised in profit or loss with an adjustment to the carrying amount of the hedged item.

Economic hedges

Where a derivative financial instrument is not designated in a qualifying hedge relationship, all changes in fair value are recognised in the profit and loss statement.

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FOREIGN CURRENCY

Foreign currency transactions

Transactions in foreign currencies are translated at the foreign exchange rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are translated to Australian dollars at the foreign exchange rate ruling at that date. Foreign exchange differences arising on translation are recognised in the profit and loss statement, except for differences arising on the translation of a financial liability designated as a hedge of the net investment in a foreign operation or qualifying cash flow hedges, which are recognised in other comprehensive income. Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction. Non-monetary assets and liabilities denominated in foreign currencies that are stated at fair value are translated to Australian dollars at foreign exchange rates ruling at the dates the fair value was determined.

Financial statements of foreign operations

The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on consolidation, are translated to Australian dollars at foreign exchange rates ruling at the balance sheet date. The revenues and expenses of foreign operations are translated to Australian dollars at rates approximating the foreign exchange rates ruling at the dates of the transactions. Foreign exchange differences arising on retranslation are recognised in other comprehensive income and presented in the foreign currency translation reserve (FCTR). When a foreign operation is disposed of, in part or in full, the relevant amount in the FCTR is transferred to profit or loss as part of the profit or loss on disposal. When the settlement of a monetary item receivable from or payable to a foreign operation is neither planned nor likely in the foreseeable future, foreign exchange gains and losses arising from such a monetary item are considered to form part of a net investment in a foreign operation and are recognised in other comprehensive income and are presented within equity in the FCTR.

Hedge of net investment in foreign operations

The Group applies hedge accounting to foreign currency differences arising between the functional currency of the foreign operation and the parent entity’s functional currency regardless of whether the net investments are held directly or through an intermediate parent. Foreign currency differences arising on the retranslation of a financial liability designated as a hedge of a net investment in a foreign operation are recognised in other comprehensive income, in the foreign currency translation reserve, to the extent that the hedge is effective. To the extent that the hedge is ineffective, such differences are recognised in the profit and loss statement. When the hedged part of a net investment is disposed of, the associated cumulative amount in equity is transferred to the profit and loss statement as an adjustment to the gain or loss on disposal.

Derivative financial instruments

The Group uses derivative financial instruments to hedge its exposure to foreign exchange and interest rate risks arising from operational, financing and investment activities. In accordance with its treasury policy, the Group does not hold or issue derivative financial instruments for trading purposes. However, derivatives that do not qualify for hedge accounting are accounted for as trading instruments.

On initial designation of the hedge, the Group formally documents the relationship between the hedging instrument(s) and hedged item(s), including the risk management objectives and strategy in undertaking the hedge transaction, together with the methods that will be used to assess the effectiveness of the hedging relationship. The Group makes an assessment, both at the inception of the hedge relationship as well as on an ongoing basis, whether the hedging instruments are expected to be “highly effective” in offsetting the changes in the fair value or cash flows of the respective hedged items during the period for which the hedge is designated. For a cash flow hedge of a forecast transaction, the transaction should be highly probable to occur and should present an exposure to variations in cash flows that could ultimately affect reported net income.

Derivative financial instruments are recognised initially at fair value. Subsequent to initial recognition, derivative financial instruments are stated at fair value and changes therein are recognised immediately in the profit and loss statement. However, where derivatives qualify for hedge accounting, recognition of any resultant gain or loss depends on the nature of the item being hedged.

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7c. Determination of fair value

The following summarises the major methods and assumptions used in estimating the fair values for measurement and disclosure purposes:

TRADE AND OTHER RECEIVABLES / PAYABLES

For receivables / payables with a remaining life of less than one year, the notional amount is deemed to reflect the fair value. All other receivables / payables are discounted to determine the fair value.

FAIR VALUE HIERARCHY

In determining fair value measurement for disclosure purposes, the Group uses the following fair value measurement hierarchy that reflects the significance of the inputs used in making the measurements:

Level 1: Quoted market price (unadjusted) in an active market for an identical instrument.
Level 2: Valuation techniques based on observable inputs, either directly (i.e., as prices) or indirectly (i.e., derived from prices).
Level 3: Valuation techniques using significant unobservable inputs. This category includes all instruments where the valuation technique includes inputs not based on observable data and the unobservable inputs have a significant effect on the instrument’s valuation.

DERIVATIVES

Forward exchange contracts are marked to market using publicly available forward rates. Interest rate contracts are marked to market using discounted estimated future cash flows based on the terms and maturity of each contract and using market interest rates for a similar instrument at the measurement date.

Where discounted cash flow techniques are used, estimated future cash flows are based on management’s best estimates and the discount rate is a market related rate for a similar instrument at the balance sheet date. Where other pricing models are used, inputs are based on market related data at the balance sheet date.

The put and call option is measured at fair value using market multiples in the TIC sector for like businesses at the measurement date.

LEASE LIABILITIES

The fair value is estimated as the present value of future cash flows, discounted at market interest rates for homogenous lease agreements. The estimated fair value reflects changes in interest rates.

SHARE-BASED PAYMENT TRANSACTIONS

The fair value of share-based awards to employees is measured using Binomial Tree (Earnings per Share and EBITDA hurdles and service condition) and Monte-Carlo Simulation (Total Shareholder Return hurdle) valuation methodologies. Measurement inputs include the Company’s share price on measurement date, expected volatility thereof, expected life of the awards, the Company’s expected dividend yield and the risk-free interest rate. Service and non-market performance conditions attached to the transactions are not taken into account in determining fair value. Refer to note 8a for details.

CONTINGENT CONSIDERATION

The fair value of contingent consideration is calculated using the income approach based on the expected payment amounts and their associated probabilities. When appropriate, it is discounted to present value.

The significant unobservable inputs are the assumed earnings of the acquirees, the discount rate and the minimum and maximum EBITDA target.

The Group assumed that the acquiree would achieve their earnings target.

LOANS AND BORROWINGS

Fair value is calculated based on discounted expected future principal and interest cash flows, discounted at the market rate of interest at the measurement date.

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7d. Auditor’s remuneration

In thousands of AUD	Consolidated 2023 2022
Audit services
Auditors of the Company EY Australia: Audit and review of consolidated and company financial reports Other EY member firms: Audit and review of consolidated and company financial reports Other services	896.0 813.0 1,920.0 1,652.0
	2,816.0 2,465.0

Auditors of the Company EY Australia: Other assurance and investigation services Other EY member firms: Other assurance and investigation services	68.0 31.0 - 7.0
	68.0 38.0

It is the Group’s policy not to use its external auditor for non-audit services. In very limited circumstances where EY is engaged, pre-approval is sought for the non-audit services being rendered.

7e. Events subsequent to balance date

NEW LOAN FACILITIES

APPOINTMENT OF NEW CEO AND MANAGING DIRECTOR

ACQUISITIONS POST BALANCE DATE

Business Acquired	ALS Segment	Consideration $m
ASR Laboratorios Group (Brazil)	Life Sciences	13.5
Hidro Lab d.o.o. (Croatia)	Life Sciences	3.1
Analytical Solutions Group (India)	Life Sciences	28.0

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FOR THE YEAR ENDED 31 MARCH 2023

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EMPLOYMENT MATTERS

This section provides information on items relating to share-based payments and key management personnel.

8a. Share-based payments

8b. Key management personnel disclosures

8a. Share-based payments

The Group operates a Long-Term Incentive Plan (LTIP) designed as a retention and reward tool for high performing personnel. Under the Plan key employees may be granted conditional rights to receive ordinary shares in the Company at no cost to the employees (or in limited cases to receive cash-settled awards). These conditional rights have performance hurdles which are assessed at the end of the performance period.

Service based rights were also issued during FY23 to some key management personnel (KMP) under the Short-Term Incentive Plan in respect of deferred compensation earned for STI during FY22. A further tranche of new Service-based rights in respect of deferred compensation earned for STI during FY23 will be granted to certain KMP during FY23. An estimated accrual for the fair value of services received in return for these new deferred STI service rights (yet to be granted) has been made at 31 March 2023 and included in the value of share-based awards for KMP shown in Table 21 of the Remuneration Report.

All of the rights carry an exercise price of nil. The terms and conditions of rights in existence during the year are set out below together with details of rights vested, lapsed and forfeited.

EQUITY-SETTLED PERFORMANCE AND SERVICE RIGHTS

All equity-settled rights refer to rights over ordinary shares in the Company and entitle an executive to ordinary shares on the vesting date subject to the achievement of performance hurdles and or a service condition. The rights expire on termination of an executive’s employment prior to the vesting date and or upon the failure of achievement of performance hurdles.

Performance-hurdle rightsgrantedyear ended 31 March:	2023 2022 2021 2020
Scheme performance period	2023-25 2022-24 2020-23 2019-22
Date of grant Testing date for performance hurdles Vesting date and testing date for service condition Number of rights:	23-Aug-22 28-Jul-21 29-Jul-20 31-Jul-19 31-Mar-25 31-Mar-24 31-Mar-23 31-Mar-22 1-Jul-25 1-Jul-24 1-Jul-23 1-Jul-22
Opening balance 1 April Granted Vested & exercised Lapsed (a) Closing balance 31 March	- 618,418 729,548 623,071 958,244 - - – - - – (593,397) (6,457) (50,761) (87,082) (29,674)
	951,787 567,657 642,466 -

Service-based rights granted year ended 31 March:	2023 2023 2023 2022 2021
Scheme performance period	2023-25 2022-24 2022-24 2021-23 2020-22
Date of grant Vesting date and testing date for service condition Number of rights:	28-Mar-23 23-Aug-22 1-Jul-22 28-Jul-21 29-Jul-20 30-May-25 1-Apr-24 1-Jul-24 1-Apr-23 1-Apr-22
Opening balance 1 April Granted Vested & exercised Lapsed (a) Closing balance 31 March	- – – 95,634 50,759 82,800 192,997 124,919 - - - – – – (48,689) - (751) - - (2,070)
	82,800 192,246 124,919 95,634 -

2023 | Annual Financial Statements

Page 102 of 113

ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

CASH-SETTLED PERFORMANCE RIGHTS

All cash-settled performance rights expire on termination of an executive’s employment prior to the vesting date and or upon the failure of achievement of performance hurdles. The amount of cash payment is determined based on the volume weighted average price of the Company’s shares over the 20 trading days following the release of the Group’s full year results for the final year of each performance period.

Performance-hurdle rights granted year ended 31 March:	2023 2022 2021 2020
Scheme performance period	2022-24 2021-24 2020-23 2019-22
Date of grant Testing date for performance hurdles Vesting date and testing date for service condition Number of rights:	23-Aug-22 28-Jul-21 29-Jul-20 31-Jul-19 31-Mar-25 31-Mar-24 31-Mar-23 31-Mar-22 1-Jul-25 1-Jul-24 1-Jul-23 1-Jul-22
Opening balance 1 April Granted Vested & exercised Lapsed (a) Closing balance 31 March	- 45,903 49,452 39,148 27,773 - - - - - - (39,148) - (4,765) (15,441) -
	27,773 41,138 34,011 -

(a) Performance-hurdle rights lapsed due to hurdles not being met or on cessation of employment.

CASH-SETTLED SERVICE-BASED RIGHTS

CASH-SETTLED SERVICE-BASED RIGHTS
Service-based rights granted year ended 31 March:	2023 2023 2022
Scheme performance period	2022-24 2022-24 2021-23
Date of grant Vesting date and testing date for service condition Number of rights:	23-Aug-22 1-Jul-22 28-Jul-21 1-Jul-24 1-Jul-24 1-Jul-23
Opening balance 1 April Granted Vested & exercised Lapsed Closing balance 31 March	- - 7,933 7,915 15,519 - – – - (2,060) - (1,721)
	5,855 15,519 6,212

VESTING CONDITIONS – PERFORMANCE HURDLE RIGHTS

Vesting conditions in relation to the performance-hurdle rights granted in August 2022 are set out below.

Employees must be employed by the Group on the vesting date (1 July 2025). The rights vest only if Earnings Per Share (“EPS”), relative Earnings before Interest, Tax, Depreciation and Amortisation (“EBITDA”), relative Total Shareholder Return (“TSR”) or Return on Capital Employed (“ROCE”) hurdles are achieved by the Company over the specified performance period. 25% of employees’ rights are subject to each of these hurdles. The performance hurdles and vesting proportions for each measure are as follows:

	Proportion of
Compound annual	performance rights that
diluted Underlying EPS	may be exercised if
growth (April 2022 to	Underlying EPS growth
March 2025)	hurdle is met
Less than 8% per annum	0%
Between 8% and 12% per annum	Straight line vesting between 12.5% and 25% of total grant
12% or higher per annum	25% of total grant

2023 | Annual Financial Statements

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ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

Underlying EBITDA margin of ALS relative to Underlying EBITDA margin of comparator peer companies (April 2022 to March 2025)

Proportion of performance rights that may be exercised if Underlying EBITDA hurdle is met

Less than the 50[th ] 0% percentile Straight line vesting Between the 50[th ] and between 12.5% and 75[th ] percentile 25% of total grant 75[th ] percentile or higher 25% of total grant

Comparator peer companies: Bureau Veritas (France), Eurofins (France & Germany), Intertek (UK), SGS (Switzerland), Applus (Spain) and Team Inc (USA).

The underlying EBITDA margin measurement is contingent upon performance of the Company against a group of comparator peer companies, which include:

Bureau Veritas (France), Eurofins (France & Germany), Intertek (UK), SGS (Switzerland), Mistras (USA), Applus (Spain) and Team Inc (USA).

TSR of ALS relative to TSR Proportion of of companies in ASX 100 performance rights Index over the period that may be exercised April 2022 to March 2025 if TSR hurdle is met

Less than the 50[th ] 0% percentile Straight line vesting Between 50[th ] percentile between 12.5% and and 75[th ] percentile 25% of total grant 75[th ] percentile or higher 25% of total grant

The TSR measurement is contingent upon performance of the Company against companies comprising the ASX 100 Index at the start of the performance period.

ROCE Performance Proportion of (3- year average over performance rights the period April 2022 that may be exercised to March 2024) if ROCE hurdle is met Below 14.2% 0% Straight line vesting Between 14.2% between 0% and 25% and 19.2% of total grant At or above 19.2% 25% of total grant

ROCE is calculated as underlying Earnings before Interest and Tax (EBIT) over the three (3) year performance period divided by Capital Employed expressed as a percentage.

Capital Employed = Total Shareholders’ Equity + Net Debt (the sum of the simple averages of the balances at the beginning and end of each year during the performance period.

The cumulative performance hurdles are assessed at the testing date and the “at risk” LTI component becomes exercisable or is forfeited by the executive at this time. New offers of participation are ratified by the Board after recommendation by the People Committee.

EXPENSES RECOGNISED AS EMPLOYEE COSTS IN RELATION TO SHARE-BASED PAYMENTS

The fair value of services received in return for LTIP rights granted during the year ended 31 March 2023 is based on the fair value of the rights granted measured using Binomial Tree (EPS, EBITDA and ROCE hurdles and service condition) and Monte-Carlo Simulation (TSR hurdle) valuation methodologies with the following inputs:

Equity-settled	Granted	Granted	Granted
rights	2023	2022	2021
Date of grant	23 August 2022	28 July 2021	29 July 2020
Weighted average
fair value at date of
grant of	$10.12	$11.20	$7.38
performance-hurdle
rights
Share price at date of grant	$12.00	$12.62	$8.29
Expected volatility	35%	35%	33%
Expected life	2.9 years	2.9 years	2.9 years
Risk-free interest rate	3.30%	0.13%	0.29%
Dividend yield	3.42%	2.54%	2.65%
Cash-settled rights	Granted 2023	Granted 2022	Granted 2020
Date of grant	23 August 2022	28 July 2021	29 July 2020
Weighted average
fair value at date of
grant of	$10.12	$11.20	$7.38
performance-hurdle
rights
Share price at date of grant	$12.00	$12.62	$8.29
Expected volatility	35%	35%	33%
Expected life	2.9 years	2.9 years	2.9 years
Risk-free interest rate	3.30%	0.13%	0.29%
Dividend yield	3.42%	2.54%	2.65%

The fair value of the liability for cash-settled rights, for which performance hurdle testing dates remain in the future, is remeasured at each reporting date.

2023 | Annual Financial Statements

Page 104 of 113

ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

Service-based rights have been issued during FY23 to some key management personnel (KMP) under the Short-Term Incentive Plan in respect of deferred compensation earned for STI outperformance during FY22. These Service Rights have had their value estimated using the volume weighted average price (VWAP) of ALS Limited shares over the five trading days which followed 31 March 2023 ($12.73).

Retention incentives in the form of service-based rights were also issued during FY23 to nominated key executives. These new service-based rights will vest in May 2025.

As at 31 March 2023 there were 495,599 services rights on issue.

Service-based rights will be issued during FY24 to some key management personnel (KMP) under the ShortTerm Incentive Plan in respect of deferred

compensation earned for STI outperformance during FY23. An estimated accrual for the fair value of services received in return for these deferred STI service rights has been made at 31 March 2023 and included in the value of share-based awards for KMP shown in Table 21 of the Remuneration Report. As these service rights are yet to be issued, their value has been estimated using the volume weighted average price (VWAP) of ALS Limited shares over the five trading days which followed 31 March 2023.

Expenses recognised in relation to share-based payments during the year were:

payments during the year were:
In thousands of AUD Note	Consolidated 2023 2022
Equity-settled rights 1d Cash-settled rights Total expenses recognised as employee costs Carrying amount of liabilities for cash-settled rights	7,925 5,289 226 (21)
	8,151 5,268
	872 1,072

8b. Key management personnel disclosures

The following were key management personnel of the Group at any time during the reporting period and unless otherwise indicated were key management personnel for the entire period:

CURRENT NON-EXECUTIVE DIRECTORS Bruce Phillips (Chairman) John Mulcahy Charlie Sartain Tonianne Dwyer Siddhartha Kadia Leslie Desjardins Peter Possemiers

EXECUTIVE DIRECTORS

Malcolm Deane (CEO and Managing Director)

EXECUTIVES

Bruce McDonald (GM Geochemistry) Andreas Jonsson (GM Food & Pharma) Tim Kilmister (GM Environmental) Luis Damasceno (Chief Financial Officer)

FORMER EXECUTIVE DIRECTOR

Raj Naran

The key management personnel compensation included in employee expenses are as follows:

In AUD	Consolidated 2023 2022
Short term employee benefits Post-employment benefits Value of share-based awards Other long-term benefits	7,994,613 8,092,973
	408,480 372,519
	3,264,013 2,264,734
	40,853 58,508
	11,707,958 10,788,735

RELATED PARTY TRANSACTION

There are no other related party transactions with Key Management Personnel during the period.

2023 | Annual Financial Statements

Page 105 of 113

ALS LIMITED AND ITS SUBSIDIARIES

FOR THE YEAR ENDED 31 MARCH 2023

Directors’ declaration

In the opinion of the directors of ALS Limited (“the Company”):

The consolidated financial statements and notes numbered 1a to 8b, and the remuneration report contained in the Directors’ report, are in accordance with the Corporations Act 2001 including:
a) giving a true and fair view of the Group’s financial position as at 31 March 2023 and of its performance for the year ended on that date: and
b) complying with Australian Accounting Standards and the Corporations Regulations 2001; and
the financial report also complies with the International Financial Reporting Standards as disclosed in note 7a.
there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.

There are reasonable grounds to believe that the Company and the subsidiaries identified in note 5c will be able to meet any obligations or liabilities to which they are or may become subject, by virtue of the Deed of Cross Guarantee between the Company and those entities, pursuant to ASIC Corporations (Wholly owned Companies) Instrument 2016/785 dated 28 September 2016 (replacing ASIC Class Order 98/1418 dated 13 August 1998).

The directors have been given the declarations required by Section 295A of the Corporations Act 2001 from the Chief Executive Officer and Chief Financial Officer for the financial year ended 31 March 2023.

Signed in accordance with a resolution of the directors:

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Bruce Phillips Chairman Brisbane 29 May 2023

Malcolm Deane

CEO & Managing Director Brisbane 29 May 2023

2023 | Annual Financial Statements

Page 106 of 113

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Ernst & Young Tel: +61 7 3011 3333 111 Eagle Street Fax: +61 7 3011 3100 Brisbane QLD 4000 Australia ey.com/au GPO Box 7878 Brisbane QLD 4001

Independent auditor’s report to the Members of ALS Limited

Report on the audit of the financial report

Opinion

We have audited the financial report of ALS Limited (the Company) and its subsidiaries (collectively the Group), which comprises the consolidated balance sheet as at 31 March 2023, the consolidated statement of profit and loss and other comprehensive income, consolidated statement of changes in equity and consolidated cash flow statement for the year then ended, notes to the financial statements, including a summary of significant accounting policies, and the directors declaration.

In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001 , including:

a. Giving a true and fair view of the consolidated financial position of the Group as at 31 March 2023 and of its consolidated financial performance for the year ended on that date; and
b. Complying with Australian Accounting Standards and the Corporations Regulations 2001 .

Basis for opinion

We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial report section of our report. We are independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial report of the current year. These matters were addressed in the context of our audit of the financial report as a whole, and in forming our opinion thereon, but we do not provide a separate opinion on these matters. For each matter below, our description of how our audit addressed the matter is provided in that context.

We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the financial report section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of the risks of material misstatement of the financial report. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying financial report.

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1. Decentralised accounting functions and Group consolidation

Why significant

As detailed in Note 1a to the financial report certain segments of the Group are outside of Australia. Note 5b discloses the Group’s significant controlled entities.

The Group has operations in over 70 countries in diverse operating segments. The subsidiaries and associates (“components”) in the Group use a wide range of accounting systems to capture financial information and report to the Group.

The majority of the Group’s results are generated in a currency other than the Group’s presentation currency.

Consolidation of the Group’s results at year end involves significant oversight by the Group to monitor components’ financial reporting.

In our role as group auditor, we are required to obtain sufficient appropriate audit evidence regarding the financial information of the components within the Group to express an opinion on the consolidated financial report. We are responsible for the direction and supervision of the component audit teams.

This is a key audit matter due to the significant number of components in the Group, the extent of foreign currency translation involved, and the diverse accounting systems used by the Group requiring significant audit effort by us.

How our audit addressed the key audit matter Our audit considered the requirements of the Australian Accounting Standard AASB 10 Consolidated Financial Statements and AASB 8 Operating Segments .

To gather evidence on significant balances that consolidate to form the Group’s financial reporting, we performed the following:

Obtained an understanding of the components in the Group and considered the risks of material misstatement associated with them.
Performed component audit scoping based on size and level of risk to the Group. Our selection also included components that did not meet the above criteria to introduce an element of unpredictability in our selection of components.
Instructed the selected component audit teams to perform procedures on the financial information prepared for consolidation purposes, including setting component materiality levels. Our audit procedures included the review of component’s compliance with the Group’s accounting policies.
Evaluated the sufficiency and appropriateness of work performed by the component audit teams and assessed the impact of accounting and auditing matters reported by the component audit teams. Our procedures included: reading the reporting deliverables of component audit teams; discussing with component audit teams the findings of their procedures and reading underlying working papers for areas of audit focus. We also participated in close out meetings with component audit teams and local management.
Checked the financial data used in the consolidation process was consistent with the financial data audited by the component audit teams. We also tested the exchange rates and method used to translate and consolidate the results of foreign components.
Assessed the adequacy of disclosure in the financial statements.

For components not within the above scope we performed analytical procedures on the financial information, compared the actual financial performance to prior year results and made inquiries of the Group and component management, to address residual risk of material misstatements and corroborate our scoping decisions.

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2. Revenue recognition

Why significant

The Group’s revenue recognition policies are described in Note 1c. The Group derives revenue from testing and inspection services provided to customers. Revenue is recognised when a finding or inspection report or test certificate is issued. Revenue recognition is a key audit matter due to the diversified and decentralised nature of the Group’s operations and the ability for overstatement of revenue due to manual posting of journal entries on consolidation .

How our audit addressed the key audit matter

Our audit considered the requirements of AASB 15 Revenue from Contracts with Customers . Our audit procedures included the following:

Obtained an understanding of the services rendered by the business segments of the Group and the related revenue recognition policy for the services rendered by the Group.
Assessed the revenue recognition processes and practices including the evaluation of key internal controls over revenue recognition.
Due to the diversified and decentralised nature of the group, worked with component audit teams to agree the scope of procedures to be performed in their respective locations.
Performed audit procedures on a sample basis to assess the completeness, accuracy and timing of revenue recognition. Our procedures included the following:
Tested the timeliness of revenue recognition by comparing individual sales transactions to customer contract and evidence of service being rendered and approved.
Tested significant credit notes issued after year-end to ensure they were recorded in the correct period and appropriately approved.
Tested accounts receivable by reviewing a sample of invoices outstanding against the proof of service delivery and by reconciling the cash receipts received after the year end to accounts receivable balances at the year end.
Tested manual revenue journals posted on consolidation to supporting documentation to assess the validity of the entry.
Assessed the adequacy of disclosure in the financial statements.

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Information other than the financial report and auditor’s report thereon

The directors are responsible for the other information. The other information comprises the information included in the Company’s 2023 financial report, but does not include the financial report and our auditor’s report thereon.

Our opinion on the financial report does not cover the other information and accordingly we do not express any form of assurance conclusion thereon, with the exception of the Remuneration Report and our related assurance opinion.

In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of the directors for the financial report

The directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error.

In preparing the financial report, the directors are responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters relating to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial report

Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report.

As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the financial report, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.

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Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial report or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial report, including the disclosures, and whether the financial report represents the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the financial report. We are responsible for the direction, supervision and performance of the Group audit. We remain solely responsible for our audit opinion.

We communicate with the directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide the directors with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards applied.

From the matters communicated to the directors, we determine those matters that were of most significance in the audit of the financial report of the current year and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on the audit of the Remuneration Report

Opinion on the Remuneration Report

We have audited the Remuneration Report included in pages 30 to 58 of the directors’ report for the year ended 31 March 2023.

In our opinion, the Remuneration Report of ALS Limited for the year ended 31 March 2023, complies with section 300A of the Corporations Act 2001 .

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Responsibilities

The directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with section 300A of the Corporations Act 2001 . Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.

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Ernst & Young

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Brad Tozer Partner Brisbane 29 May 2023

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Ernst & Young Tel: +61 7 3011 3333 111 Eagle Street Fax: +61 7 3011 3100 Brisbane QLD 4000 Australia ey.com/au GPO Box 7878 Brisbane QLD 4001

Auditor’s independence declaration to the directors of ALS Limited

As lead auditor for the audit of the financial report of ALS Limited for the financial year ended 31 March 2023, I declare to the best of my knowledge and belief, there have been:

a. No contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit;
b. No contraventions of any applicable code of professional conduct in relation to the audit; and
c. No non-audit services provided that contravene any applicable code of professional conduct in relation to the audit.

This declaration is in respect of ALS Limited and the entities it controlled during the financial year.

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Ernst & Young

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Brad Tozer Partner 29 May 2023

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AI assistant

ALS LIMITED — Annual Report 2023

64365_rns_2023-05-28_dc3db21d-2093-4895-b17a-2d34812ccf10.pdf

Appendix 4E

Full year report for the Year Ending 31 March 2023

Results for announcement to the market

Dividend Disclosures

Dividend - Amount per security

Total final dividend (distribution) on all securities

NTA backing

Audit

ANNUAL FINANCIAL STATEMENTS

Contents

Directors’ report

For the year ended 31 March 2023

DIRECTORS

BRUCE PHILLIPS

B Sc (Hons) (Geology) Chairman and Independent Non-Executive Director Age 68

RAJ NARAN

B Sc (Chemistry), B A (Mathematics) Former Managing Director and Chief Executive Officer

Age 61

JOHN MULCAHY PhD, B E (Civil Eng) (Hons), FIE Aust Independent Non-Executive Director Age 73

CHARLIE SARTAIN

B Eng (Hons) (Mining), FAusIMM, FTSE

Independent Non-Executive Director Age 62

TONIANNE DWYER

B Juris (Hons), LLB (Hons), GAICD Independent Non-Executive Director Age 60

SIDDHARTHA KADIA

Ph.D. Biomedical Engineering,

B.E., Electronics

and Telecommunication Independent Non-Executive Director Age 53

LESLIE DESJARDINS

B. Industrial Admin, Finance (Kettering), MS. Business (MIT)

Independent Non-Executive Director Age 63

PETER POSSEMIERS

Bachelor of Applied Science in Chemistry and Microbiology – University of South Australia Independent Non-Executive Director Age 62

COMPANY SECRETARY

MICHAEL PEARSON LLB, B A, GAICD, GCIS, Dip Inv Rel (AIRA)

PRINCIPAL ACTIVITIES

MALCOLM DEANE Bachelor of Laws (Masters) Juris Doctor Managing Director and Chief Executive Officer Age 39

REVIEW OF RESULTS AND OPERATIONS

Group business summary

FY27 vision

Financial performance

Financial performance

Financial performance (continued)

focused on growth initiatives across both divisions.

Divisional reviews

2023 performance

Life Sciences

Value proposition

Medium to Long Term Outlook

Commodities

Value proposition

2023 performance

Discontinued operations (Asset Care)

DIVIDENDS

DEBT PROFILE

FINANCIAL POSITION

MATERIAL BUSINESS RISKS

Material Business Risk Statement

Material Business Risks (MBRs)

Climate and environment

Corporate affairs and social performance

Financial management

Growth and transformation

Legal and compliance

Operations

People

Innovation & technology

TASK FORCE ON CLIMATERELATED FINANCIAL DISCLOSURES (TCFD)

Governance

The Board’s role

Audit and Risk Committee

People Committee

Management’s role

Performance Incentive Plan

Strategy and scenario planning

Reviewing our climate-related risks and opportunities

Time Horizons

ALS LIMITED Annual Report 2023