mpact
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MPACT LIMITED

AUDITED ANNUAL FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

IMPACT LIMITED
AUDITED ANNUAL FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

Directors' responsibility statement and basis of preparation, approval of the financial statements and certificate by Group Company Secretary 1
Chief Executive Officer and Chief Financial Officer Responsibility Statement 2
Independent Auditor's Report 3-7
Report of the Directors 8-11
Audit and Risk Committee Report 12-18
Statement of profit or loss and other comprehensive income 19
Statement of financial position 20
Statement of cash flows 21
Statement of changes in equity 22
Notes to the annual financial statements 23-44

DIRECTORS' RESPONSIBILITY STATEMENT AND BASIS OF PREPARATION

The directors are responsible for preparing the annual financial statements in accordance with applicable laws and regulations.

These annual financial statements have been prepared using accounting policies compliant with IFRS® Accounting Standards, the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee and Financial Reporting Pronouncements as issued by the Financial Reporting Standards Council and are in compliance with the Companies Act, 2008 of South Africa.

The preparation of these annual financial statements for the year ended 31 December 2024 was supervised by the Chief Financial Officer ("CFO"), JJ Snyman CA(SA).

In preparing the annual financial statements, International Accounting Standard 1, 'Presentation of Financial Statements', requires that the directors:

select and apply accounting policies;
present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information;
provide additional disclosure when compliance with the specific requirements in IFRS® are insufficient to enable users to understand the impact of particular transactions, other events and conditions on the entity's financial position and financial performance; and
make an assessment of Mpact Limited ("Mpact") ability to continue as a going concern.

APPROVAL OF THE ANNUAL FINANCIAL STATEMENTS

The directors confirm that the annual financial statements are prepared in accordance with IFRS® Accounting Standards, the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee and Financial Reporting Pronouncements as issued by the Financial Reporting Standards Council, and the requirements of the Companies Act of South Africa, fairly present the assets, liabilities, financial position and profit of Mpact.

The directors believe that Mpact has adequate resources to continue in operation for the foreseeable future and the financial statements have therefore been prepared on a going concern basis.

The report of the directors, which appears on pages 8 to 11, annual financial statements and related notes, which appear on pages 19 to 44 were approved and authorised for issue by the Board of Directors on 06 March 2025 and were signed on its behalf by:

AJ Phillips
Chairman

BW Strong
Chief Executive Officer

CERTIFICATE BY GROUP COMPANY SECRETARY

In terms of section 88(2)(e) of the Companies Act, I certify that Mpact Limited has lodged with the Companies and Intellectual Property Commission all such returns and notices, as are required of a Company in terms of the Act and, that such returns are true, correct and up to date.

D.Dickson
Group Company Secretary
06 March 2025

MPACT LIMITED 1

CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER RESPONSIBILITY STATEMENT

In compliance with paragraphs 3.84(k) of the JSE Limited Listings Requirements, the CEO and CFO, whose names are stated below, after due, careful and proper consideration hereby confirm that:

The annual financial statements set out on pages 8 to 44, fairly present in all material respects the financial position, financial performance and cash flows of Mpact in terms of IFRS®;
To the best of our knowledge and belief, no facts have been omitted or untrue statements made that would make the annual financial statements of Mpact false or misleading;
Internal financial controls have been put in place to ensure that material information relating to Mpact, and its consolidated subsidiaries have been provided to effectively prepare the financial statements of Mpact;
The internal financial controls are adequate and effective and can be relied upon in compiling the annual financial statements, having fulfilled our role and function as executive directors with primary responsibility for implementation and execution of controls;
Where we are not satisfied, we have disclosed to the Audit Committee and the auditor any deficiencies in design and operational effectiveness of the internal financial controls and have taken steps to remedy the deficiencies; and
We are not aware of any fraud involving directors.

MPACT LIMITED 2

pwc

Independent auditor's report

To the shareholders of Mpact Limited

Report on the audit of the separate financial statements

Our opinion

In our opinion, the separate financial statements present fairly, in all material respects, the separate financial position of Mpact Limited (the Company) as at 31 December 2024, and its separate financial performance and separate cash flows for the year then ended in accordance with IFRS Accounting Standards and the requirements of the Companies Act of South Africa.

What we have audited

Mpact Limited's separate financial statements set out on pages 17 to 42 comprise:

the separate statement of financial position as at 31 December 2024;
the separate statement of profit or loss and other comprehensive income for the year then ended;
the separate statement of changes in equity for the year then ended;
the separate statement of cash flows for the year then ended; and
the notes to the financial statements, including material accounting policy information.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the separate financial statements section of our report.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence

We are independent of the Company in accordance with the Independent Regulatory Board for Auditors' Code of Professional Conduct for Registered Auditors (IRBA Code) and other independence requirements applicable to performing audits of financial statements in South Africa. We have fulfilled our other ethical responsibilities in accordance with the IRBA Code and in accordance with other ethical requirements applicable to performing audits in South Africa. The IRBA Code is consistent with the corresponding sections of the International Ethics Standards Board for Accountants' International Code of Ethics for Professional Accountants (including International Independence Standards).

PricewaterhouseCoopers Inc., 4 Lisbon Lane, Waterfall City, Jukskei View, 2090
Private Bag X36, Sunninghill, 2157, South Africa
T: +27 (0) 11 797 4000, F: +27 (0) 11 209 5800, www.pwc.co.za

Chief Executive Officer: L S Machaba

The Company's principal place of business is at 4 Lisbon Lane, Waterfall City, Jukskei View, where a list of directors' names is available for inspection.

Reg. no. 1998/012055/21, VAT reg.no. 4950174682

pwc

Our audit approach

Overview

Final materiality	Overall materiality: R70.6 million, which represents 1% of total assets.
Key audit matters	Not applicable

As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the separate financial statements. In particular, we considered where the directors made subjective judgements; for example, in respect of significant accounting estimates that involved making assumptions and considering future events that are inherently uncertain. As in all of our audits, we also addressed the risk of management override of internal controls, including among other matters, consideration of whether there was evidence of bias that represented a risk of material misstatement due to fraud.

In terms of the IRBA Rule on Enhanced Auditor Reporting for the Audit of Financial Statements of Public Interest Entities, published in Government Gazette Number 49309 dated 15 September 2023 (EAR Rule), we report final materiality below.

Final materiality

The scope of our audit was influenced by our application of materiality. An audit is designed to obtain reasonable assurance whether the separate financial statements are free from material misstatement. Misstatements may arise due to fraud or error. They are considered material if individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the separate financial statements.

Based on our professional judgement, we determined certain quantitative thresholds for materiality, including the final materiality for the separate financial statements as a whole as set out in the table below. These, together with qualitative considerations, helped us to determine the scope of our audit and the nature, timing and extent of our audit procedures and to evaluate the effect of misstatements, both individually and in aggregate on the separate financial statements as a whole.

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	Separate financial statements
Final materiality	R70.6 million
How we determined it	1% of total assets
Rationale for the materiality benchmark applied	We chose total assets as the benchmark because, in our view, it is the benchmark against which the performance of the Company is most commonly measured by users, and is a generally accepted benchmark. We chose 1% which is consistent with quantitative materiality thresholds used for investment holding companies.

Key audit matters

We have determined that there are no key audit matters to communicate in our report.

Other information

The directors are responsible for the other information. The other information comprises the information included in the document titled "Mpact Limited Group audited consolidated annual financial statements for the year ended 31 December 2024" and the document titled "Mpact Limited Audited Financial Statements for the year ended 31 December 2024", which includes the Report of the Directors, the Audit and Risk Committee Report and the Certificate by Group Company Secretary as required by the Companies Act of South Africa and the document titled "Mpact 2024 Integrated Report". The other information does not include the consolidated or the separate financial statements and our auditor's reports thereon.

Our opinion on the separate financial statements does not cover the other information and we do not express an audit opinion or any form of assurance conclusion thereon.

In connection with our audit of the separate financial statements, our responsibility is to read the other information identified above and, in doing so, consider whether the other information is materially inconsistent with the separate financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

pwc

Responsibilities of the directors for the separate financial statements

The directors are responsible for the preparation and fair presentation of the separate financial statements in accordance with IFRS Accounting Standards and the requirements of the Companies Act of South Africa, and for such internal control as the directors determine is necessary to enable the preparation of separate financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the separate financial statements, the directors are responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the separate financial statements

Our objectives are to obtain reasonable assurance about whether the separate financial statements as a whole are 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 ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these separate financial statements.

As part of an audit in accordance with ISAs, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the separate financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company'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 separate financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are

pwc

based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern.

Evaluate the overall presentation, structure and content of the separate financial statements, including the disclosures, and whether the separate financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

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 with the directors, we determine those matters that were of most significance in the audit of the separate financial statements of the current period 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 other legal and regulatory requirements

Audit tenure

In terms of the IRBA Rule published in Government Gazette Number 39475 dated 4 December 2015, we report that PricewaterhouseCoopers Inc. has been the auditor of Mpact Limited for 2 years.

PricewaterhouseCoopers Inc.
PricewaterhouseCoopers Inc.
Director: S Bootha
Registered Auditor
Johannesburg, South Africa
7 March 2025

MPACT LIMITED
FOR THE YEAR ENDED 31 DECEMBER 2024

REPORT OF THE DIRECTORS

The directors have pleasure in presenting their report on the annual financial statements of Mpact Limited ("Mpact") for the year ended 31 December 2024.

NATURE OF BUSINESS

Mpact acts as a holding company for local and foreign investments and properties used within the Mpact Group. The principal activities of Mpact remain unchanged from the previous year.

Mpact is incorporated in the Republic of South Africa and is listed on the Johannesburg Stock Exchange (JSE) and has a secondary listing on A2X.

FINANCIAL RESULTS

Mpact's profit for the year ended 31 December 2024 was R252.3 million (2023: R152.6 million). Full details of the financial position and results are set out in the accompanying annual financial statements.

STATED CAPITAL

The authorised share capital is 217,500,000 ordinary shares of no-par value.

On 31 December 2024 the issued share capital of Mpact was 149,453,688 ordinary shares of no-par value. (2023: 149,453,688 ordinary shares of no-par value).

Mpact Incentive Scheme Trust owns 2,046,850 (2023: 2,023,132) treasury shares to satisfy share awards under the Group's share incentive scheme. Refer to note 15 of annual financial statements.

DIVIDENDS

Notice is hereby given that the Board has declared a final gross cash dividend of 75 cents for the year ended 31 December 2024 (60 cents net of dividend withholding tax) per ordinary share. The dividend has been declared from income reserves. A dividend withholding tax of 20% will be applicable to all shareholders who are not exempt. The company's total number of issued ordinary shares as at dividend declaration date is 149,453,688. Mpact's income tax reference number is 9003862175.

The Board of Directors are satisfied that the liquidity and solvency of the company, as well as capital remaining after payment of the dividend is sufficient to support the current operations and to facilitate future development of the business in the year ahead.

Salient dates with regard to the ordinary dividend

Publication of dividend declaration	Monday, 10 March 2025
Last date of trade to receive a dividend	Tuesday, 8 April 2025
Shares commence trade ex-dividend	Wednesday, 9 April 2025
Record date	Friday, 11 April 2025
Payment date	Monday, 14 April 2025

All times provided are South African local times. The above dates and times are subject to change. Any material change will be announced on the SENS.

Share certificates may not be dematerialised or re-materialised between Wednesday, 9 April 2025 and Friday, 11 April 2025, both days inclusive.

REGISTER OF SHAREHOLDERS

The register of shareholders of Mpact is open for inspection during normal office hours, at the office of Mpact's transfer secretaries, JSE Investor Services (Proprietary) Limited.

JSE Investor Services (Proprietary) Limited replaced Computershare Investor Services (Proprietary) Limited as transfer secretaries with effect from 1 March 2024.

MPACT LIMITED 8

MPACT LIMITED
FOR THE YEAR ENDED 31 DECEMBER 2024

REPORT OF THE DIRECTORS (continued)

INVESTMENT PROPERTY

At 31 December 2024, the net investment in property amounted to R921.4 million (2023: R940.6 million), details of which are set out in note 7 to the annual financial statements. Capital commitments at year-end amounted to R52.7 million (2023: R76.2 million), set out in note 19.

DIRECTORS

The following directors have held office during the year ended 31 December 2024 and to the date of this report:

AJ Phillips (Chairman)	Independent Non-executive
ABA Conrad	Independent Non-executive
PCS Luthuli	Independent Non-executive
M Makanjee	Independent Non-executive
TDA Ross	Independent Non-executive (retired on 6 June 2024)
DG Wilson	Independent Non-executive
FC Futwa	Independent Non-executive (appointed on 17 May 2024)
BW Strong (Chief Executive Officer)	Executive
JJ Snyman (Chief Financial Officer)	Executive (appointed on 1 June 2024)
BDV Clark (Chief Financial Officer)	Executive (retired on 31 May 2024)

COMPANY SECRETARY

D Dickson

Registered Office

4th Floor

3 Melrose Boulevard

Melrose Arch, 2196

SPONSOR

The Standard Bank of South Africa Limited

AUDITOR

PricewaterhouseCoopers Inc. (PwC) is the appointed auditor to Mpact, with S Bootha the designated auditor.

FINANCIAL ASSISTANCE BY MPACT LIMITED

Notwithstanding the title of section 45 of the Companies Act, 71 of 2008, being "Loans or Other Financial Assistance to Directors", the body of the section also applies to financial assistance provided by Mpact to any related or inter-related company or corporation and a member of a related or inter-related corporation.

At the 2024 AGM, shareholders opposed special resolution 2, which sought to renew Mpact's general authority to provide financial assistance to its subsidiaries and other related and inter-related entities in terms of sections 44 and 45 of the Companies Act.

While shareholders again voted against this resolution, as a result of the amendments to the Companies Act which became effective in December 2024, the giving of financial assistance to, or for the benefit of, a company's South African subsidiary is now excluded from the requirements of section 45. As a consequence of these changes to the Companies Act, Mpact Limited may therefore provide financial assistance to its South African subsidiaries in the Group without the need for a special resolution of Mpact's shareholders.

Details of subsidiaries are included in the interest in subsidiaries, set out in note 28.

MPACT LIMITED 9

MPACT LIMITED
FOR THE YEAR ENDED 31 DECEMBER 2024

REPORT OF THE DIRECTORS (continued)

AUDIT AND RISK COMMITTEE

The Audit and Risk Committee ("the committee") operate on a Group-wide basis. The committee, in terms of the Companies Act of South Africa, King IV and JSE Listing Requirements has the responsibility, among other things, for monitoring the integrity of Mpact's financial statements. It also has the responsibility for reviewing the effectiveness of Mpact's system of internal controls and risk management systems. An internal audit function has been established which is responsible for advising the Board of Directors on the effectiveness of Mpact's risk management processes.

The committee oversees the relationship with the external auditor; is responsible for their appointment and remuneration; reviews the effectiveness of the external audit process; and ensures that the objectivity and independence of the external auditor is maintained.

In collaboration with the internal and external auditor, a combined assurance map was developed.

The committee has concluded that it is satisfied that auditor independence and objectivity has been maintained. The comprehensive report of the committee is included on pages 12 to 18.

GOING CONCERN

The annual financial statements have been prepared on the basis of accounting policies applicable to a going concern. During the year the company made a profit of R252.3 million (2023: R152.6 million). Based on the future plans projections, there were no adverse ratios therefore the company is considered solvent and liquid.

The directors are of the view that the company is able to trade as a going concern and is able to settle its current liabilities as they occur during the normal course of business over the next twelve months.

EVENTS OCCURRING AFTER THE REPORTING DATE

On 3 February 2025, Mpact advised shareholders that its ordinary shares would be traded on A2X with effect from 11th February 2025.

On 06 March 2025, the Board declared an ordinary dividend of 75 cents per share payable on 14 April 2025 to shareholders registered on 11 April 2025.

There were no other significant or material subsequent events which would require adjustment to or disclosure in the annual financial statements.

INTEREST OF DIRECTORS AND PRESCRIBED OFFICERS IN SHARE CAPITAL

The aggregate beneficial holdings as at 31 December 2024 and 31 December 2023 of the directors and prescribed officers of Mpact in the issued ordinary shares of Mpact are detailed below. There have been no changes in these shareholdings between 31 December 2024 and 10 March 2025, the date of approval.

| | 2024
Direct
No. of
shares | 2024
Indirect
No. of
shares | 2023
Direct
No. of
shares | 2023
Indirect
No. of
shares |
| --- | --- | --- | --- | --- |
| Executive director | | | | |
| BW Strong | 1,254,632 | – | 1,254,632 | – |
| JJ Snyman (appointed on 1 June 2024) | – | 7,350 | – | – |
| BDV Clark (retired on 31 May 2024) | – | 541,006 | – | 541,006 |
| Non-executive director | | | | |
| AJ Phillips | 8,914 | 1,516 | 8,914 | 1,516 |
| Total | 1,263,546 | 549,872 | 1,263,546 | 542,522 |

There are no associate interests for the above directors.

MPACT LIMITED 10

MPACT LIMITED
FOR THE YEAR ENDED 31 DECEMBER 2024

REPORT OF THE DIRECTORS (continued)

INTEREST OF DIRECTORS AND PRESCRIBED OFFICERS IN SHARE CAPITAL (CONTINUED)

Major shareholders

(5% and more of the shares in issue)

	No. of shares	% of total issue share capital
31 December 2024
Caxton and CTP Publishers and Printers Limited	50,299,943	33.66
Gayatri Paper Mills Gauteng Proprietary Limited	15,991,213	10.70
Old Mutual Group	9,621,384	6.44
Mirabaud & Cie SA	7,724,208	5.17
M & G Investments	7,581,003	5.07
31 December 2023
Caxton and CTP Publishers and Printers Limited	50,299,943	33.66
Gayatri Paper Mills Gauteng Proprietary Limited	15,142,659	10.13
Old Mutual Group	10,680,618	7.15
Mirabaud & Cie SA	7,724,208	5.17
31 December 2024 Shareholder Type	Number of shareholdings	% of total shareholdings
---	---	---
Non-Public Shareholders	9	0.19
Share Schemes	1	0.02
Directors & Prescribed Officers: Direct Shareholdings^{1}	5	0.11
Directors: Indirect Shareholdings	3	0.06
Public Shareholders	4,663	99.81
Total	4,672	100.00
31 December 2023 Shareholder Type
---	---	---
Non-Public Shareholders	10	0.20
Share Schemes	1	0.02
Directors & Prescribed Officers: Direct Shareholdings^{1}	6	0.12
Directors: Indirect Shareholdings	3	0.06
Public Shareholders	4,872	99.80
Total	4,882	100.00

1 Includes shares held by the directors of Mpact Operations Proprietary Limited.

MPACT LIMITED 11

MPACT LIMITED
FOR THE YEAR ENDED 31 DECEMBER 2024

AUDIT AND RISK COMMITTEE REPORT

I am pleased to present this report on behalf of the Audit and Risk Committee (committee), which provides an overview of the areas of focus for the committee during the year ended 31 December 2024, as well as its key activities and the framework within which it operates in compliance with section 94(7) of the Companies Act.

INTRODUCTION

The role of the committee is to ensure the integrity of Mpact's financial reporting and audit processes and that a sound risk management and internal control system is maintained. In pursuing these objectives, the committee oversees relations with the External Auditors and reviews the effectiveness of the Internal Audit function.

The committee acts for Mpact and all its subsidiaries, and is an independent body accountable to the Board. It operates within a documented charter and complies with all relevant legislation, regulation and governance codes and executes its duties in terms of the requirements of King IV™.

The committee's terms of reference were approved by the Board during the current financial year and are reviewed annually.

COMPOSITION

The committee currently comprises of Sibusiso Luthuli, Fikile Futwa and Donald Wilson, all of whom are independent non-executive directors and collectively possess the appropriate financial skills, expertise and experience required to discharge their duties. In May 2024, Fikile Futwa was appointed as a member of the committee. Fikile has significant financial and commercial experience, making her well placed to contribute positively to the functioning of the committee. In June 2024, Tim Ross retired from the committee. Tim had been the chairman of the committee for several years and had provided invaluable leadership and guidance to the committee. Sibusiso Luthuli was appointed as the interim Chairman of the committee in July 2024. The CEO, the CFO, the Chief Information Officer (CIO), the Group Risk and Sustainability Manager, a representative of KPMG, the independent Internal Auditor, and a representative of PwC, the independent External Auditor, and other senior managers attend meetings by invitation.

The committee members are appointed annually by the shareholders at the Annual General Meeting.

MEETINGS

The committee held a total of four meetings during the year.

Name	Member since	Meetings Attended
Sibusiso Luthuli	December 2018	4/4
Fikile Futwa	May 2024	3/4*
Donald Wilson	January 2022	4/4
Tim Ross	April 2011	2/4**

Joined the committee on 17 May 2024.
*Retired on 6 June 2024.

MPACT LIMITED 12

MPACT LIMITED
FOR THE YEAR ENDED 31 DECEMBER 2024

AUDIT AND RISK COMMITTEE REPORT (continued)

COMMITTEE ACTIVITIES

The committee attended to the following matters during the year:

EXTERNAL AUDITORS

The committee reviewed the independence of PwC as Mpact's external auditors, for the financial year ended 31 December 2024. The committee considered the suitability of PwC as external auditor, with Saffiyah Bootha as the independent individual registered auditor, by reviewing all information as required by section 3.84(g) and 3.86 of the JSE Listings Requirements in assessing PwC's independence, registration as a Registered Auditor and the ability to perform a quality audit of Mpact. The committee held at least one meeting with PwC without management present, and the committee chairman also engaged regularly with the PwC engagement partner.

After considering the factors below and the auditor's tenure, the committee is satisfied that PwC is independent of Mpact.

Independence of external auditors

This assessment was made after considering the following:

confirmation from the external auditors that they, or their immediate family, do not hold any direct or indirect financial interest or have any material business relationship with Mpact. The external auditors also confirmed that they have internal monitoring procedures to ensure their independence;
the auditors do not, other than in their capacity as external auditors or rendering permitted non-audit services, receive any remuneration or other benefits from Mpact;
the auditor's independence was not impaired by the non-audit work performed having regard to the nature of the non-audit work undertaken and the quantum of the non-audit fees relative to the total fee base;
the auditor's independence was not prejudiced as a result of any previous appointment as auditor. In addition, an audit partner rotation process is in place in accordance with the relevant legal and regulatory requirements;
the criteria specified for independence by the Independent Regulatory Board for Auditors (IRBA);
information provided by the auditors in terms of the JSE Listings Requirements, Paragraph 22.15(h); and
the audit firm and the designated auditor are accredited with the JSE.

The committee confirms that the external auditor has functioned in accordance with its terms of reference for the 2024 financial year.

External auditors' fees

The committee:

approved, in consultation with management, the audit fee and engagement terms for the external auditors for the 2024 financial year;
reviewed and approved the non-audit services fees for the year under review and ensured that the fees were in line with the non-audit service policy; and
determined the nature and extent of allowable non-audit services and approved the contract terms for the provision of non-audit services through the Audit Committee charter.

MPACT LIMITED 13

MPACT LIMITED
FOR THE YEAR ENDED 31 DECEMBER 2024

AUDIT AND RISK COMMITTEE REPORT (continued)

External auditors' performance

The committee:
- reviewed and approved the external audit plan, ensuring that material risk areas were included and that coverage of the significant business processes was acceptable;
- monitored the effectiveness of the external auditors in terms of audit quality and expertise; and
- reviewed and discussed the external audit reports and management's response and considered their effect on the financial statements and internal financial control.

FINANCIAL STATEMENTS

The committee reviewed the interim results and year-end consolidated annual financial statements, the public announcements of Mpact's financial results and made recommendations to the Board for their approval. In the course of its review, the committee:
- took appropriate steps to ensure that the financial statements were prepared in accordance with IFRS;
- considered the appropriateness of accounting policies and disclosures made;
- approved Group financial reporting procedure in accordance with the JSE Listings Requirements;
- considered and approved accounting policy changes resulting from the application of new standards commencing 1 January 2024;
- completed a detailed review of the going concern assumption, confirming that it was appropriate in the preparation of the financial statements, which includes reviews of solvency and liquidity test for the year under review; and
- ensured that appropriate financial reporting procedures are established and operating.

PROACTIVE MONITORING

The Audit and Risk Committee hereby confirms that the findings contained in the JSE Proactive Monitoring reports, thematic reviews and common findings reports, were taken into account when preparing the consolidated and separate annual financial statements, as well as the preliminary summarised consolidated annual financial statements for the year ended 31 December 2024.

SIGNIFICANT MATTERS

The figures disclosed in the annual financial statements in certain circumstances are arrived at using judgement. These are explained in detail in the accounting policies. The committee has considered the qualitative and quantitative aspects of the information presented in the statement of financial position and other items that require significant judgement.

MPACT LIMITED 14

MPACT LIMITED
FOR THE YEAR ENDED 31 DECEMBER 2024

AUDIT AND RISK COMMITTEE REPORT (continued)

INTERNAL AUDIT

The committee:

reviewed and approved the existing internal audit charter, which ensures that Mpact's internal audit function is independent and has the necessary resources, standing and authority within the organisation to enable it to discharge its duties;
satisfied itself of the credibility, independence and objectivity of the internal audit function;
ensured that internal audit had direct access to the committee, primarily through the committee's Chairman;
reviewed and approved the annual internal audit plan, ensuring that material risk areas were included and that the coverage of significant business processes was acceptable;
reviewed the quarterly internal audit reports, covering the effectiveness of internal controls and material non-compliance with Mpact's policies and procedures. The committee is advised of all internal control developments and any material losses;
considered and reviewed with management and internal auditors, any significant findings and management responses thereto in relation to reliable financial reporting, corporate governance and effective internal control to ensure appropriate action is taken; and
considered the assessment from the internal audit function regarding the effectiveness of Mpact's system of internal controls and confirmed that based on their results of work undertaken, they provided reasonable assurance regarding adequacy and effectiveness of systems of internal control.

The committee has reviewed the independence of KPMG and the Chief Audit Executive as Mpact's internal auditor and is satisfied with their independence and the performance of the Chief Audit Executive.

INTERNAL FINANCIAL CONTROL AND COMPLIANCE

The committee:

reviewed and approved the existing treasury policy and reviewed the quarterly treasury reports prepared by management;
reviewed the quarterly legal and regulatory reports setting out the latest legislative and regulatory developments impacting Mpact;
reviewed the quarterly report on taxation;
reviewed IT reports; and
considered and, where appropriate, made recommendations on internal financial controls.

MPACT LIMITED 15

MPACT LIMITED
FOR THE YEAR ENDED 31 DECEMBER 2024

AUDIT AND RISK COMMITTEE REPORT (continued)

Internal financial reporting control

The committee reviewed the internal financial control statement made by the CEO and CFO in terms of paragraph 3.84(k) of the JSE Listings Requirements. This paragraph requires a statement by the CEO and CFO to confirm that the internal financial controls are in place to ensure that material information has been provided to effectively prepare the consolidated annual financial statements. Internal financial reporting risks were identified and documented across key reporting processes as well as at a business unit level.

The committee assessed the CEO and CFO evaluation of controls which included:

the identification and classification of risks;
testing the design and determining the implementation of controls addressing high and low risk areas;
utilising internal audit to test the operating effectiveness of controls addressing high risk areas; and
obtaining control declarations from divisional managers on the operating effectiveness of all controls on an annual basis.

The Audit and Risk Committee is satisfied that the internal financial controls are adequate and effective to assist in compiling the consolidated annual financial statements. Where deficiencies in design and operational effectiveness of the internal financial controls have been noted, necessary remedial actions will be taken. The Audit and Risk Committee is satisfied that none of these deficiencies had a material effect for the purposes of the preparation and presentation of the consolidated annual financial statements for the year ended 31 December 2024.

The Group's management team remain committed to ongoing improvements ensuring that the control environment remains sound for reliable consolidated annual financial statements and safeguarding of the Group's assets.

RISK MANAGEMENT

The Board, through the Audit and Risk Committee, governs risk in a way that supports the organisation in setting and achieving its strategic objectives and sets the direction for how risk should be approached and addressed in the organisation. The Audit and Risk Committee reviews and approves the Risk Management Committee Terms of reference on an annual basis and delegates to management the responsibility to implement and execute effective risk management. Management is regularly developing and enhancing Mpact's risk and control procedures to improve the mechanisms for identifying, assessing and monitoring risks given that effective risk management is integral to Mpact's objective of consistently adding value to its businesses. The committee approves policies that articulates and gives effect to ongoing oversight of risk management.

Risk management is addressed in the areas of business risks, physical and operational risks, human resource risks, technology risks, business continuity and disaster recovery risks, credit and market risks and compliance risks.

Mpact has implemented several policies and procedures to manage its governance, operations and information systems with regard to the:

reliability, security and integrity of financial and operational information;
effectiveness and efficiency of operations;
safeguarding of people and assets;
reducing of our environmental footprint, and
compliance with laws, regulations and contracts.

MPACT LIMITED 16

MPACT LIMITED
FOR THE YEAR ENDED 31 DECEMBER 2024

AUDIT AND RISK COMMITTEE REPORT (continued)

A Risk Management Committee identifies and evaluates strategic and operational risks against ten value drivers of:

achieving operational, profitability and liquidity objectives;
protecting our reputation, public image (ethics, environment, customer safety) and CSI initiatives;
ensuring compliance with legislation and contractual terms;
developing a motivated workforce;
achieving the Group's strategy;
providing safe and healthy operating conditions;
managing environmentally responsible operations;
achieving growth objectives;
building effective commercial stakeholder relations; and
ensuring accurate and timely reporting.

The committee assessed the effectiveness of the controls and determined how well management perceived the identified controls. The Likelihood rating tables and Potential Loss Impact Rating were reviewed and approved. The Risk Management Review is available on the website, www.mpact.co.za.

IT GOVERNANCE

The Board has approved an ICT governance policy and ensures adherence to the King IV™ IT governance principles. The ICT Steering Committee, chaired by the CEO, provides assurance to the Board regarding ICT governance-related matters. The Audit and Risk Committee reviews and approves the ICT Committee Terms of Reference on an annual basis and delegates to management the responsibility to implement and execute effective technology and information management. This gives guidance to the ICT management team and ensures effective and efficient management of all ICT resources.

The ICT governance framework, with all relevant structures, processes and mechanisms enable ICT to deliver value to the business and mitigate ICT risks. ICT risks that have been identified are incorporated into the organisational risk register, and managed through the Risk Management Committee.

An external independent ICT advisor has been appointed to provide the Board of Directors with independent assurance on the effectiveness of ICT internal controls, including outsourced ICT services. In addition, the ICT advisor is required to join the ICT Steering Committee to give guidance on the alignment of the ICT strategy with the business strategy. This includes, but is not limited to, expressing an independent opinion on emerging technology trends and their rate of adoption and implementation by various business sectors. ICT maturity assessments are concluded by the independent advisor periodically to determine improvement and opportunities for further development in ICT. This is reported on by the independent advisor to the Audit and Risk Committee.

The ICT Steering Committee is satisfied that the resource capacity within the ICT function is adequate to provide the necessary support and growth to Mpact. In making these assessments, the committee has obtained feedback from the external and internal auditors.

COMBINED ASSURANCE

A combined assurance model and plan was developed by management in collaboration with internal audit and external audit. The mapping was compiled to help understand the level planned assurance coverage from all assurance providers across the various lines of assurance as reflected in the combined assurance model.

The committee approved the Integrated Risk Assurance Framework and noted that further improvements will be incorporated in the combined assurance model.

MPACT LIMITED 17

MPACT LIMITED

FOR THE YEAR ENDED 31 DECEMBER 2024

AUDIT AND RISK COMMITTEE REPORT (continued)

INTEGRATED REPORT

The committee fulfils an oversight role regarding the Integrated Report and the financial reporting process. As part of this role, it considers the Integrated Report and its consistency with operational, financial and other information known to the committee members, as well as consistency with the consolidated annual financial statements. The committee also considers input from the Chairs of other committees.

GOVERNANCE

The Board of Directors has assigned oversight of the risk management function to the committee, which has an oversight role with respect to financial reporting risks arising from internal financial controls, fraud and IT risks.

During May 2024, the committee oversaw the recruitment process of the Chief Financial Officer and made recommendations for approval to the Nominations Committee and the Board.

In line with the terms of the JSE Listings Requirements, the committee is satisfied that JJ Snyman CA (SA) has the appropriate expertise and experience to meet the responsibilities of his appointed position as CFO as required by the JSE.

The committee is also satisfied:

that the resources within the finance function are adequate to provide the necessary support to the CFO; and
with the expertise and experience of the Group Financial Controller.

In making these assessments, the committee has obtained feedback from the external and internal auditors.

Based on the processes and assurances obtained, the committee believes that the accounting practices are effective.

ASSURANCE

The committee confirms that they were prudent in exercising their duties of care and skill and they have taken reasonable steps to ensure that they performed their duties in accordance with the mandate of the committee.

On behalf of the Audit and Risk Committee

Sibusiso Luthuli
Audit and Risk Committee Interim Chairman
06 March 2025

MPACT LIMITED 18

MPACT LIMITED
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2024

	Notes	2024 R'm	2023 R'm
Revenue	2	369.1	275.3
Operating expenses		(44.7)	(56.5)
Depreciation, impairments and reversal of impairments		(48.2)	(42.3)
Operating profit	3	276.2	176.5
Investment income	4	2.8	1.4
Finance costs	5	(13.3)	(5.7)
Profit before tax		265.7	172.2
Tax expense	6	(13.4)	(19.6)
Profit for the year		252.3	152.6
Total comprehensive income for the year		252.3	152.6

MPACT LIMITED 19

MPACT LIMITED
STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2024

	Notes	2024 R'm	2023 R'm
ASSETS
Investment property	7	921.4	940.6
Investments in subsidiaries	8	5,980.3	5,979.4
Investment in the Mpact share incentive trust	9	46.5	52.1
Deferred tax assets	10	–	6.4
Non-current assets		6,948.2	6,978.5
Other receivables	11	32.4	50.8
Cash and cash equivalents	12	78.3	30.4
Current assets		110.7	81.2
Total assets		7,058.9	7,059.7
EQUITY AND LIABILITIES
Capital and reserves
Stated capital	15	2,360.9	2,360.9
Retained earnings		4,632.1	4,542.5
Reserves		17.9	24.4
Total equity		7,010.9	6,927.8
Loan from subsidiary	13	–	74.5
Deferred tax liabilities	10	16.1	–
Non-current liabilities		16.1	74.5
Trade and other payables	14	30.6	51.2
Current tax liabilities		1.3	6.2
Current liabilities		31.9	57.4
Total liabilities		48.0	131.9
Total equity and liabilities		7,058.9	7,059.7

MPACT LIMITED 20

MPACT LIMITED
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2024

	Notes	2024 R'm	2023 R'm
Cash flows from operating activities
Operating cash flows before movements in working capital		131.9	108.6
Net increase in working capital		(2.2)	(27.6)
Cash generated from operations	16	129.7	81.0
Dividend received		200.0	120.0
Taxation refund/(paid)	17	6.3	(13.2)
Net cash inflows from operating activities		336.0	187.8
Cash flows from investing activities
Additions to investment property	7	(29.0)	(96.0)
Proceeds from the disposal of investment property		–	8.9
Additional share purchased in foreign subsidiary		(0.9)	–
Interest received	4	2.8	1.4
Contributions to the share incentive trust		(16.3)	(16.1)
Net cash outflows from investing activities		(43.4)	(101.8)
Cash flows from financing activities
Loan raised from subsidiary	18	182.0	228.5
Repayment of loan from subsidiary	18	(256.5)	(165.0)
Issue of ordinary shares¹		–	37.3
Finance costs paid		(13.3)	–
Dividends paid to equity holders of Mpact Limited		(156.9)	(178.4)
Net cash outflows from financing activities		(244.7)	(77.6)
Net increase in cash and cash equivalents		47.9	8.4
Net cash and cash equivalents at the beginning of the year		30.4	22.0
Net cash and cash equivalents at the end of the year	12	78.3	30.4

¹Issue of shares to group subsidiaries in respect of the 2020 share award vesting.

MPACT LIMITED 21

MPACT LIMITED
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2024

	Stated capital R'm	Share-based payment reserve R'm	Retained earnings R'm	Total equity R'm
Balance at 01 January 2023	2,323.6	23.3	4,592.1	6,939.0
Total comprehensive income for the year	–	–	152.6	152.6
Dividend paid¹	–	–	(178.4)	(178.4)
Share plan charges for the year (refer to note 21)	–	13.7	–	13.7
Issue/exercise of shares under employee share scheme	37.3	(12.6)	(23.8)	0.9
Balance at 31 December 2023	2,360.9	24.4	4,542.5	6,927.8
Total comprehensive income for the year	–	–	252.3	252.3
Dividend paid¹	–	–	(156.9)	(156.9)
Share plan charges for the year (refer to note 21)	–	7.5	–	7.5
Issue/exercise of shares under employee share scheme	–	(14.0)	(5.8)	(19.8)
Balance at 31 December 2024	2,360.9	17.9	4,632.1	7,010.9

¹ The dividend paid was 105c per share (2023: 120c per share).

MPACT LIMITED 22

MPACT LIMITED
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

ACCOUNTING POLICIES

Basis of preparation

These annual financial statements have been prepared using accounting policies compliant with IFRS® Accounting Standards as issued by the International Accounting Standards Board (IASB), the SAICA Financial Reporting Guide as issued by the Accounting Practices Committee and the Financial Reporting Pronouncements as issued by the Financial Reporting Standards Council, the JSE Limited's Listings Requirements, and the requirements of the Companies Act of South Africa. The annual financial statements have been prepared on the historical cost basis, except for derivative financial instruments. The annual financial statements have been prepared on a going concern basis. The annual financial statements are presented in South African Rand, which is Mpact's functional currency. All financial information presented in Rand has been rounded off to the nearest million. Mpact is regarded as an individual segment and therefore no segmental disclosure is required.

The basis of preparation is consistent with the prior year, except for new and revised standards adopted to the annual financial statements. Mpact is incorporated and domiciled in South Africa and the registered office is located at 4th Floor, 3 Melrose Boulevard, Melrose Arch, 2196.

New accounting policies, early adoption and future requirements

Amendments to published Standards and Interpretations that are effective and have been adopted during 2024

IAS 1: Classification of Liabilities as Current or Non-Current (effective 1 January 2024)
The amendment aims to promote consistency in determining whether, in the statement of financial position, debt and other liabilities with an uncertain settlement date should be classified as current (due or potentially due to be settled within one year) or non-current.
IAS 1: Non-current Liabilities with Covenants (effective 1 January 2024)
The amendment specifies that only covenants an entity must comply with on or before the reporting period should affect classification of the corresponding liability as current or non-current.
IFRS 16 - Leases on sale and leaseback (effective 1 January 2024)
The amendment explains how an entity accounts for a sale and leaseback after the date of the transaction. Sale and leaseback transactions where some or all the lease payments are variable lease payments that do not depend on an index or rate are most likely to be impacted.

This amendment is not applicable, as Mpact did not have any leases on sale and leaseback for the year ended 31 December 2024.

MPACT LIMITED 23

MPACT LIMITED
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

ACCOUNTING POLICIES (CONTINUED)

Amendments to published Standards and Interpretations that are not yet effective and have not been early adopted

The following published amendments are not yet effective. Mpact will adopt these once they are effective.

IAS 21: Lack of exchangeability (effective 1 January 2025)
The amendment specifies how to assess whether a currency is exchangeable and how to determine the exchange rate.

The adoption of the amendment is not anticipated to have a significant impact on the financial statements.

IFRS 9 and IFRS 7: Classification and Measurement of Financial Instruments (effective 1 January 2026)
The amendments provide clarity as follows:
the requirements for the timing of recognition and derecognition of some financial assets and liabilities, with a new exception for some financial liabilities settled through an electronic cash transfer system;
clarify and add further guidance for assessing whether a financial asset meets the solely payments of principal and interest (SPPI) criterion;
add new disclosures for certain instruments with contractual terms that can change cash flows (such as some instruments with features linked to the achievement of environment, social and governance (ESG) targets); and
make updates to the disclosures for equity instruments designated at Fair Value through Other Comprehensive Income (FVOCI).

Mpact is currently working to identify the impact of IFRS 9 and IFRS 7 on the financial statements.

IFRS 18: Presentation and Disclosure in Financial Statements (effective 1 January 2027)
IFRS 18 introduces new requirements for presentation within the statement of profit or loss. Mpact is required to classify all income and expenses within the statement of profit or loss into one of five categories: operating, investing, financing, income taxes and discontinued operations.

It also requires disclosure of management-defined performance measures, subtotals of income and expenses, and includes new requirements for aggregation and disaggregation of financial information based on the identified 'roles' of the primary financial statements (PFS) and the notes.

Mpact is currently working to identify the impact of IFRS 18 on the financial statements.

MPACT LIMITED 24

MPACT LIMITED
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

2. REVENUE

Rental income

Revenue is derived principally as a result of properties under operating leases. Mpact recognises lease payments received under operating leases as income on a straight-line basis over the lease term.

Dividend income

Dividend income from investments is recognised when Mpact's right to receive payment has been established.

Management fee income

Revenue from management fees is recognised at the fair value of the consideration received or receivable. Management fees recognised relates to a recovery of costs from subsidiaries and are recognised net of value-added taxation.

| | 2024
R'm | 2023
R'm |
| --- | --- | --- |
| Rental income | 142.6 | 129.7 |
| Management fee income^{1} | 26.5 | 25.6 |
| Dividend income^{2} | 200.0 | 120.0 |
| | 369.1 | 275.3 |

1 Recovery of costs charged to Group subsidiaries.
2 Received from Mpact Operations Proprietary Limited.

3. OPERATING PROFIT

Operating profit for the year has been arrived at after charging/(crediting):

	48.2	42.3
Depreciation of investment property (refer to note 7)	48.2	43.9
Reversal of impairment of investment in share trust (refer to note 9)	–	(1.6)
Professional fees	6.4	13.4
Audit fees	3.3	3.9
Share based payments	7.5	13.7
Profit on disposal of investment property	–	(3.9)
Executive directors short term benefits (excluding value of deferred bonus shares awarded)	15.1	17.3
Executive directors post-employment benefits (excluding value of deferred bonus shares awarded)	0.6	0.5

MPACT LIMITED 25

MPACT LIMITED
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

4. INVESTMENT INCOME

Interest income, which is derived from cash and cash equivalents and is accrued on a time proportion basis by reference to the principal outstanding and at the effective interest rate applicable.

	2024	2023
	R'm	R'm
Bank deposits	2.3	1.4
Interest from SARS	0.5	–
Total investment income	2.8	1.4

5. FINANCE COSTS

Finance costs consists of interest expense on a loan from a subsidiary and is recognised using the effective interest method.

	2024	2023
	R'm	R'm
Finance costs on from loan from subsidiary	(13.3)	(5.7)
Total finance costs	(13.3)	(5.7)

MPACT LIMITED 26

MPACT LIMITED

NOTES TO THE ANNUAL FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

6. TAX EXPENSE

The current tax expense is calculated on the taxable profit for the year using tax rates that have been enacted or substantively enacted at the reporting date.

Deferred taxation

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amount of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit and is accounted for using the liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. The carrying amount of deferred tax assets is reviewed at each reporting date and is adjusted to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the asset to be recovered.

Deferred tax is calculated at the tax rates that are expected to apply in the year when the liability is settled or the asset is realised. Deferred tax is charged or credited in the statement of profit or loss and other comprehensive income, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also taken directly to equity.

| | 2024
R'm | 2023
R'm |
| --- | --- | --- |
| Analysis of tax charge for the year | | |
| South African corporate tax | | |
| - current year | (21.1) | (26.7) |
| - prior year^{1} | 26.4 | – |
| Current tax | 5.3 | (26.7) |
| Deferred tax in respect of the current year | 0.6 | 7.1 |
| Deferred tax in respect of the prior year^{2} | (19.3) | – |
| Total tax charge | (13.4) | (19.6) |
| Factors affecting tax charge for the year | | |
| Mpact's effective rate of tax for the year ended 31 December 2024, calculated on profit before tax is 5.0% (2023: 11.4%). | | |
| Mpact's total tax charge for the year can be reconciled to the tax on Mpact's profit before tax at the South African corporation tax rate of 27% (2023: 27%) as follows: | | |
| Profit before tax | 265.7 | 172.2 |
| Tax on profit before tax calculated at the South African corporation tax rate | (71.7) | (46.5) |
| Tax effects of: | | |
| Non-taxable income | | |
| Dividend income | 54.0 | 32.4 |
| Non-taxable gain on profit on sale of property | – | 0.4 |
| Expenses not deductible for tax purposes | | |
| Legal and professional costs | (0.8) | (2.7) |
| Non-deductible expenses attributable to exempt income | (2.0) | (3.6) |
| Reversal of impairment in the Mpact share incentive trust | – | 0.4 |
| Temporary difference adjustments | | |
| Prior year adjustment current tax | 26.4 | – |
| Prior year adjustment deferred tax | (19.3) | – |
| Tax charge for the year | (13.4) | (19.6) |

1Relates to tax allowance on s12BA claimed on submission of tax return (2023: Utilisation of additional tax losses on submission of the tax return).
2Relates to the change in the tax value of plant and equipment as a consequence of the above tax allowances claimed.

MPACT LIMITED 27

MPACT LIMITED
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

INVESTMENT PROPERTY

Investment properties are held to earn rental and/or for capital appreciation. Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition, investment properties are measured at cost less accumulated depreciation.

Depreciation is charged so as to write off the cost of assets, other than land and assets in the course of construction, over their estimated useful lives to their estimated residual values. Buildings have an estimated useful life of up to a maximum of 50 years.

At each reporting date, Mpact reviews the carrying amounts to determine whether there is any indication that the investment properties are impaired. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment. Where the underlying circumstances change such that a previously recognised impairment subsequently reverses, the carrying amount is increased to the revised estimate of its recoverable amount. Such reversal is limited to the carrying amount that would have been determined had no impairment been recognised for the asset in prior years.

Residual values and useful lives are reviewed at least annually.

	Land and buildings R'm	Assets in the course of construction R'm	Total R'm
2024
Cost
1 January	1,128.6	25.3	1,153.9
Additions	–	29.0	29.0
Transfer to/from assets in the course of construction	48.7	(48.7)	–
31 December	1,177.3	5.6	1,182.9
Accumulated depreciation
1 January	213.3	–	213.3
Depreciation	48.2	–	48.2
31 December	261.5	–	261.5
Net book value at 31 December 2024	915.8	5.6	921.4
2023
Cost
1 January	970.1	95.5	1,065.6
Additions	–	96.0	96.0
Disposals	(7.7)	–	(7.7)
Transfer to/from assets in the course of construction	166.2	(166.2)	–
31 December	1,128.6	25.3	1,153.9
Accumulated depreciation
1 January	172.1	–	172.1
Disposals	(2.7)	–	(2.7)
Depreciation	43.9	–	43.9
31 December	213.3	–	213.3
Net book value at 31 December 2023	915.3	25.3	940.6

MPACT LIMITED 28

MPACT LIMITED
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

7. INVESTMENT PROPERTY (CONTINUED)

Direct operating expenses arising from investment property that generated rental income amounting to R7.9 million (2023: R7.0 million) was recognised in the statement of profit or loss. Lessees are responsible for maintaining the leased properties.

The fair value of the investment properties are R1,081.6 million (2023: R1,052.5 million), measured by an independent valuator. The investment properties are considered to be level 3 according to the fair value hierarchy. The inputs used by the independent valuator in determining the fair value according to the income capitalisation approach were as follows:

a market rental rate per square meter in the area the properties are located,
direct operating expenses and
a capitalisation rate, the rate at which similar assets have traded recently and is influenced by, rates of return on comparable properties; risk; obsolescence; inflation gross market rental growth rate; rates of return on alternative investments; mortgage rates; property expenditure; lease covenant; and vacancies.

Financial guarantee

Certain land and buildings with a carrying value of R233.0 million (2023: R233.9 million) are pledged as security in respect of bank loans of Mpact Operations Proprietary Limited. It is unlikely that Mpact Operations Proprietary Limited would default on its bank covenants and repayments.

A register of land and buildings is open for inspection upon prior arrangement at the registered office of Mpact.

| | | 2024
R'm | 2023
R'm |
| --- | --- | --- | --- |
| 8. INVESTMENT IN SUBSIDIARIES | | | |
| Investments in subsidiaries are carried at cost and are adjusted for any impairment losses. An equity instrument is any contract which evidences a residual interest in the net assets of an entity. | | | |
| Unlisted | Country of incorporation | | |
| Mpact Operations Proprietary Limited | South Africa | 5,955.9 | 5,955.9 |
| Mpact Namibia Proprietary Limited | Namibia | 22.6 | 22.6 |
| Embalagens Mpact LDA | Mozambique | 1.8 | 0.9 |
| | | 5,980.3 | 5,979.4 |

Refer to the interest in subsidiaries on note 28 for details of the investment in subsidiary companies. The investment in Mpact Operations Proprietary Limited is pledged as security in respect of the bank loans of Mpact Operations Proprietary Limited.

Investments key assumptions

Investments have been tested for impairment by comparing the recoverable amounts of the cash-generating units (CGU) to the carrying amounts of the investments. There are no impairment indicators.

9. INVESTMENT IN SHARE TRUST

Investments in the share trust is carried at cost, net of any impairment losses.

Carrying value in share trust	46.5	52.1

Mpact Limited funds the Share Incentive Trust through capital contributions.

MPACT LIMITED 29

MPACT LIMITED
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

	2024	2023
	R'm	R'm
10. DEFERRED TAX
Deferred tax asset
Opening balance	6.4	2.7
Charged to statement of profit or loss	–	7.1
Charged to equity	–	(3.4)
Reclassification	(6.4)	–
	–	6.4
Deferred tax liabilities
Opening balance	–	–
Charged to statement of profit or loss	(18.7)	–
Charge to equity	(3.8)	–
Reclassification	6.4	–
	(16.1)	–
The amount of deferred taxation provided in the accounts is presented as follows:
Deferred tax (liabilities)/assets
Capital allowances	(16.7)	(0.8)
Provisions and other temporary differences	0.6	7.2
	(16.1)	6.4
Mpact has applied the exception to recognising and disclosing information about deferred taxes related to Pillar Two.
11. OTHER RECEIVABLES
Related party receivables	2.2	3.7
Lease smoothing asset	20.6	19.5
Sundry receivables	9.6	27.6
	32.4	50.8
The fair values of other receivables approximate the carrying values presented. Other receivables are considered to have a low credit risk as the other debtors have the future capacity to meet their contractual cash flow obligations. Mpact had considered the above based on past experience and current conditions and therefore did not raise any expected credit losses in the current and prior financial year.
12. CASH AND CASH EQUIVALENTS
Cash at bank and on hand	78.3	30.4
	78.3	30.4
There are no expected credit losses on cash and cash equivalents.
13. LOAN FROM SUBSIDIARY
Mpact Operations Proprietary Limited	–	74.5
	–	74.5

Interest on the loan is incurred at prime plus 2% and is repayable on notice of 367 days. The loan is unsecured and has a limit of R400 million.

MPACT LIMITED 30

MPACT LIMITED
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

| | 2024
R'm | 2023
R'm |
| --- | --- | --- |
| 14. TRADE AND OTHER PAYABLES | | |
| External trade payables | 10.9 | 5.7 |
| Related parties trade payables | 6.4 | 31.8 |
| Other payables and accruals | 13.3 | 13.7 |
| | 30.6 | 51.2 |

The fair values of trade and other payables are not materially different to the carrying values presented. Other payables and accruals consist mainly of payroll and operating expenses.

15. STATED CAPITAL

Dividend distributions to Mpact's ordinary equity holders are recognised as a liability in the period in which the dividends are declared and approved. Final dividends are accrued when approved by the Board.

| | 2024
R'm | 2023
R'm |
| --- | --- | --- |
| Authorised share capital | | |
| 217,500,000 shares of no-par value | – | – |
| Issued share capital | | |
| Issue of shares of no-par value | 2,360.9 | 2,323.6 |
| Issue of shares¹ | – | 37.3 |
| | 2,360.9 | 2,360.9 |
| Reconciliation of the number of shares in issue: | Number of shares | Number of shares |
| --- | --- | --- |
| Shares in issue at the beginning of the year | 149,453,688 | 148,175,363 |
| Issue of shares¹ | – | 1,278,325 |
| Shares in issue at the end of the year | 149,453,688 | 149,453,688 |

¹On 3 May 2023, Mpact Limited issued 1,278,325 shares to participants of a group subsidiary under the Mpact Share Incentive Scheme at R29.20 per share, as part of the 2020 share award vesting.

The directors were not given the authority to buy back Mpact's own shares at the Annual General Meeting held on 6 June 2024.

Included in the share-based payment reserves are amounts paid by Mpact Limited to Mpact Limited Incentive Schemes Trust for the acquisition of Mpact shares to be utilised in terms of the Share Plans. Refer to note 21. As at 31 December 2024, The Trust held 2,046,850 shares (2023: 2,023,132). During the year the Trust bought 2,167,253 shares at an average price of R27.15 and 2,143,535 shares vested to employees in terms of the Share Plans.

MPACT LIMITED 31

MPACT LIMITED
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

| | 2024
R'm | 2023
R'm |
| --- | --- | --- |
| 16. CASH GENERATED FROM OPERATIONS | | |
| Profit before taxation | 265.7 | 172.2 |
| Depreciation of investment property | 48.2 | 43.9 |
| Reversal of impairment in share trust | – | (1.6) |
| Share-based payments | 7.5 | 13.7 |
| Investment income | (2.8) | (1.4) |
| Finance costs | 13.3 | 5.7 |
| Dividend income | (200.0) | (120.0) |
| Profit on disposal of investment property | – | (3.9) |
| Net increase in working capital | (2.2) | (27.6) |
| Decrease/(increase) in receivables | 18.4 | (9.0) |
| Decrease in payables | (20.6) | (18.6) |
| | 129.7 | 81.0 |
| 17. TAXATION REFUND/(PAID) | | |
| Opening balance - tax payable | (6.2) | (4.8) |
| Current tax charge for the year | 5.3 | (26.7) |
| Tax effects on shares purchased for vesting | 5.9 | 12.1 |
| Closing balance payable | 1.3 | 6.2 |
| | 6.3 | (13.2) |

18. CHANGE IN LIABILITIES ARISING FROM CASH FLOWS FROM FINANCING ACTIVITIES

2024	1 January	Cash inflows	Cash outflows	Interest capitalised	31 December
	R'm	R'm	R'm	R'm	R'm
Loan from subsidiary	74.5	182.0	(256.5)	–	–
	74.5	182.0	(256.5)	–	–
2023
Loan from subsidiary	5.3	228.5	(165.0)	5.7	74.5
	5.3	228.5	(165.0)	5.7	74.5

MPACT LIMITED 32

MPACT LIMITED
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

| | 2024
R'm | 2023
R'm |
| --- | --- | --- |
| 19. CAPITAL COMMITMENTS | | |
| Contracted for | – | 64.2 |
| Approved, not yet contracted for | 52.7 | 12.0 |
| | 52.7 | 76.2 |
| The above commitments mainly relate to the installation of solar on owned properties. The capital commitments will be financed from cash generated from operations and the loan facility from Mpact Operations Proprietary Limited. | | |
| 20. OPERATING LEASE RECEIVABLES | | |
| | 2024
R'm | 2023
R'm |
| Mpact's operating leases are with related parties. These leases have a maximum lease term of 5 years.
The outstanding undiscounted receivables under non-cancellable leases were: | | |
| Within one year | 148.0 | 138.6 |
| One to two years | 100.9 | 134.8 |
| Two to five years | 121.5 | 168.7 |
| | 370.4 | 442.1 |

21. SHARE BASED PAYMENTS

Mpact participates in two equity settled, share-based compensations, namely: Bonus Share Plan (BSP) and Performance Share Plan (PSP). The vesting condition of the BSP is continued employment for a period of 3 years. The vesting condition of the PSP is dependent on Headline Earnings Per Share growth (HEPS) and Return on Capital Employed (ROCE) for a period of 3 years. The share-based payments arrangement are for executives and senior employees of Mpact Limited and its subsidiaries.

The fair value of the employee services received in exchange for the grant of share awards is recognised concurrently as an expense and an adjustment to equity. The total amount to be expensed over the vesting period is determined by reference to the fair value of the share awards granted. In respect of PSP, the expense is adjusted to take into account the probability of achieving the two performance conditions. At each reporting date, Mpact revises its estimates of the number of share awards that are expected to vest. It recognises the impact of the revision to original estimates, if any, in the statement of comprehensive income, with a corresponding adjustment to equity. During the vesting period, participants do not have shareholders' rights. Therefore, participants do not have the right to vote nor the right to share in the dividend distribution.

The total fair value charge in respect of all the Mpact share awards granted are as follows:

| | 2024
R'm | 2023
R'm |
| --- | --- | --- |
| Bonus Share Plan (BSP) | 3.9 | 3.5 |
| Performance Share Plan (PSP) | 3.6 | 10.2 |
| Total share-based payment expense | 7.5 | 13.7 |

MPACT LIMITED 33

MPACT LIMITED
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

21. SHARE BASED PAYMENTS (CONTINUED)

The fair values of the share awards granted under the Mpact share plans are calculated using the Black-Scholes-Merton Model with reference to the facts and assumptions presented below:

Bonus Share Plan (BSP)	2024	2023	2022	2021
Date of grant	4 April	1 April	1 April	1 April
Vesting period (months)	36	36	36	36
Expected leavers per annum (%)	-	-	-	-
Future risk-free interest rate	8.46%	8.47%	6.59%	5.92%
Grant date fair value per instrument (R)	22.97	26.46	28.86	18.70
Performance Share Plan (PSP)
---	---	---	---	---
Date of grant	4 April	1 April	1 April	1 April
Vesting period (months)	36	36	36	36
Expected leavers per annum (%)	-	-	-	-
Share price volatility	-	-	-	-
Future risk-free interest rate	8.46%	8.47%	6.59%	5.92%
Expected outcome of meeting performance criteria
-Return on capital employed ("ROCE") component	30%	60%	90%¹	100%
-HEPS growth	90%	90%	90%¹	100%
Grant date fair value per instrument (R)
- HEPS component	22.97	26.46	28.86	18.70
- ROCE component	22.97	26.46	28.86	18.70

¹ROCE was changed to 79.8% and HEPS growth to 0% in the current financial year.

A reconciliation of share award movements is shown below:

| | BSP
Number of
shares | PSP
Number of
shares |
| --- | --- | --- |
| 2024 | | |
| 1 January 2024 | 439,615 | 1,467,800 |
| Shares conditionally awarded in the year | 122,121 | 497,179 |
| Shares vested in the year | (151,880) | (595,608) |
| Transfers in the year | 29,714 | - |
| 31 December 2024 | 439,570 | 1,369,371 |
| 2023 | | |
| 1 January 2023 | 604,919 | 2,159,622 |
| Shares conditionally awarded in the year | 151,771 | 465,267 |
| Shares vested in the year | (317,075) | (1,109,302) |
| Shares lapsed in the year | - | (47,787) |
| 31 December 2023 | 439,615 | 1,467,800 |

During the year share awards were vested at a share price of R27.00 per share.

MPACT LIMITED 34

MPACT LIMITED
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

22. FINANCIAL RISK MANAGEMENT

Financial assets and financial liabilities are recognised in Mpact's statement of financial position when Mpact becomes party to the contractual provisions of the instrument. A financial asset or financial liability is initially measured at fair value. A trade receivable without a significant financing component is initially measured at the transaction price.

On initial recognition, a financial asset is classified as measured at amortised cost.

Financial asset investments

Loans and receivables are measured at initial recognition at fair value and are subsequently measured at amortised cost using the effective interest rate method, less any expected credit losses as appropriate.

Cash and cash equivalents

Cash and cash equivalents comprise cash at banks and on hand.

Other receivables

On initial recognition, trade receivables are classified as measured at amortised cost using the effective interest rate method, less any expected credit losses as appropriate.

Trade payables

On initial recognition, trade payables are classified as measured at amortised cost using the effective interest rate method.

Valuation of financial instruments

The fair value of financial instruments, excluding derivative instruments, not traded in active, liquid and organised financial markets are determined using a variety of valuation methods and assumptions that are based on market conditions and risks existing at the reporting date, including independent appraisals and discounted cash flow methods.

Measurement of fair values

A number of Mpact's accounting policies and disclosures require the measurement of fair values for both financial and non-financial assets and liabilities. Mpact has an established control framework with respect to the measurement of fair values. Significant valuation issues are reported to Mpact's Audit Committee.

When measuring the fair value of an asset or a liability, Mpact uses observable market data as far as possible. Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:

Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.

Mpact's trading and financing activities expose it to various financial risks that, if left unmanaged, could adversely impact on current or future earnings. Although not necessarily mutually exclusive, these financial risks are categorised separately according to their different generic risk characteristics and include market risk (interest rate risk), credit risk and liquidity risk. Mpact is actively engaged in the management of all of these financial risks in order to minimise their potential adverse impact on Mpact's financial performance.

Fair value estimation

The fair value of trade and other receivables and trade and other payables approximate their carrying values due to the short-term maturities of these instruments.

MPACT LIMITED 35

MPACT LIMITED
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

22. FINANCIAL RISK MANAGEMENT (CONTINUED)

The principles, practices and procedures governing the Company-wide financial risk management process have been approved by the Board and are overseen by the executive committee. In turn, the executive committee delegates authority to a central treasury function (Company treasury) for the practical implementation of the financial risk management process across Mpact and for ensuring that the company's entities adhere to specified financial risk management policies. Company treasury continually reassesses and reports on the financial risk environment, identifying, evaluating and hedging financial risks by entering into derivative contracts with counterparties where appropriate. Mpact does not take speculative positions on derivative contracts and only enters into contractual arrangements with counterparties that have investment grade credit ratings.

MARKET RISK

Mpact's activities are exposed to interest rate risk. The risk is actively monitored on a continuous basis and primarily relate to interest rate exposure on loans from a group subsidiary.

Interest rate risk

Mpact holds cash and cash equivalents, which earn interest at a variable rate and has variable rate debt in issue. Consequently, Mpact is exposed to interest rate risk.

Management of variable rate debt

Mpact had a loan from a subsidiary which incurred interest at prime plus 2%. Mpact's cash and cash equivalents acts as a natural hedge against possible unfavourable movements in the prime lending rates.

Net variable rate debt sensitivity analysis

The net variable rate exposure represents variable rate debt less and cash and cash equivalents. Reasonably possible changes in interest rates have been applied to net variable rate exposure, in order to provide an indication of the possible impact on Mpact's statement of profit or loss. Mpact considered that a reasonable possible change to be the change in the prime lending rate.

Interest rate risk sensitivities on variable rate debt

| | 2024
R'm | 2023
R'm |
| --- | --- | --- |
| Total debt | – | 74.5 |
| Less: Cash and cash equivalents | (78.3) | (30.4) |
| Net variable rate exposure | (78.3) | 44.1 |
| +/- basis points change | | |
| Potential impact on earnings + 50 basis points (2023: +125 basis points) | 0.3 | (0.4) |
| Potential impact on earnings - 50 basis points (2023: -125 basis points) | (0.3) | 0.4 |

CREDIT RISK

Mpact's credit risk is mainly confined to the risk of borrowers defaulting on borrowings. In the current and prior financial year, no amount in trade and other receivables was past due.

| | 2024
R'm | 2023
R'm |
| --- | --- | --- |
| Maximum exposure to credit risk | | |
| Cash and cash equivalents | 78.3 | 30.4 |
| Other receivables (excluding prepayments and accrued income) | 11.8 | 31.3 |
| Total credit risk exposure | 90.1 | 61.7 |

Credit risk exposure arising on cash and cash equivalents is managed through dealing with well-established financial institutions of good standing for investment and cash management purposes. Moody's bank ratings relating to the bank balances were Ba1.

MPACT LIMITED 36

MPACT LIMITED

NOTES TO THE ANNUAL FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

22. FINANCIAL RISK MANAGEMENT (CONTINUED)

LIQUIDITY RISK

Liquidity risk is the risk that Mpact could experience difficulties in meeting its commitments to creditors as financial liabilities fall due for payment. Mpact manages its liquidity risk by using reasonable and retrospectively-assessed assumptions to forecast the future cash-generative capabilities and working capital requirements of the businesses it operates and by maintaining sufficient reserves, committed borrowing facilities and other credit lines as appropriate.

Contractual maturity analysis

Trade receivables, the principal class of non-derivative financial assets held by Mpact, are settled gross by customers. Mpact's financial investments, which are not held for trading and therefore do not comprise part of Mpact's liquidity planning arrangements, make up the remainder of the non-derivative financial assets held.

The following table presents Mpact's outstanding contractual maturity profile for its non-derivative financial liabilities. The analysis presented is based on the undiscounted contractual maturities of Mpact's financial liabilities, including any interest that will accrue, except where Mpact is entitled and intends to repay a financial liability, or part of a financial liability, before its contractual maturity. Non-interest bearing financial liabilities which are due to be settled in less than 12 months from maturity equal their carrying values, since the impact of the time value of money is immaterial over such a short duration.

Maturity profile of outstanding financial liabilities - undiscounted cash flows

	<1 year R'm	1-2 years R'm	2-5 years	Total R'm
2024
Loan from subsidiary	–	–	–	–
	–	–	–	–
2023
Loan from subsidiary	–	97.9	–	97.9
	–	97.9	–	97.9
			2024	2023
Undiscounted cash flow - less than one year			R'm	R'm
Trade and other payables			30.6	51.2
Total			30.6	51.2
			2024	2023
Financial instruments by category			Amortised cost R'm	Amortised cost R'm
Financial assets
Cash and cash equivalents^{1}			78.3	30.4
Other receivables^{1}			11.8	31.3
Total			90.1	61.7
Financial liabilities
Loan from subsidiary (Level 3 fair value hierarchy)			–	74.5
Trade and other payables^{1}			30.6	51.2
Total			30.6	125.7

The carrying value reasonably approximates the fair value.

MPACT LIMITED 37

MPACT LIMITED
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2024

23. CAPITAL MANAGEMENT

Mpact defines its total capital employed as loans and investments plus cash and cash equivalents less equity.

The capital structure of Mpact is equity funded, comprising of stated capital as referred to in note 15, reserves and retained earnings.

24. RELATED PARTY TRANSACTIONS

Mpact has a related party relationship with its subsidiaries, associates and directors.

Details of transactions and balances between Mpact and related parties are disclosed below:

| | 2024
R'm | 2023
R'm |
| --- | --- | --- |
| Rental income from subsidiaries | 139.4 | 129.7 |
| Management fees received from subsidiaries | 26.5 | 25.6 |
| Dividend income from subsidiary | 200.0 | 120.0 |
| Finance costs incurred from subsidiary | 13.3 | 5.7 |
| Dividend paid to Mpact Limited Incentive Scheme | 1.7 | 2.4 |
| Trade receivables | 2.2 | 3.7 |
| Trade payables | 6.4 | 31.8 |
| Loan from subsidiary (refer to note 13) | – | 74.5 |

The rental agreements and management fee received with related parties are made on terms equivalent to those that prevail in arm's length transactions. There are no expected credit losses on the trade receivables.

Details of the executive directors and prescribed officers' remuneration is included in note 29.

25. CONTINGENT LIABILITY

As advised to shareholders on 26 May 2016, the Company was subject to a Competition Commission investigation pertaining to alleged anti-competitive conduct between Mpact and New Era. Mpact co-operated with the Competition Commission and dealt with the issues identified transparently through applying for corporate leniency in respect of the Competition Commission's investigations. The Competition Commission has concluded a consent agreement with New Era Packaging regarding the historic investigations, which have been settled by New Era without any admission of liability. Mpact is pleased to note that, as the Commission has settled with New Era, this historic matter has now been finalised. Mpact and the Competition Commission have also concluded a settlement agreement relating to Mpact's historic acquisition of minority interests in certain sheet plants for an amount of R7.0 million.

26. EVENTS OCCURRING AFTER THE REPORTING DATE

On 3 February 2025, Mpact advised shareholders that its ordinary shares would be traded on A2X with effect from 11th February 2025.

On 06 March 2025, the Board declared an ordinary dividend of 75 cents per share payable on 14 April 2025 to shareholders registered on 11 April 2025.

There were no other significant or material subsequent events which would require adjustment to or disclosure in the annual financial statements.

27. GOING CONCERN

MPACT LIMITED 38

MPACT LIMITED

NOTES TO THE ANNUAL FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

INTEREST IN SUBSIDIARIES, ASSOCIATES AND JOINT ARRANGEMENTS

	Country of incorporation	Share capital		Shareholding
		2024	2023	2024 %	2023 %
Subsidiaries - Direct Holding
Mpact Operations Proprietary Limited^{1}	RSA	R20 000	R20 000	90	90
Sunko Mauritius^{2}	Mauritius	-	R100	-	100
Embalagens Mpact Limitada^{3}	Mozambique	M3,346,800	M1,213,000	90	90
Mpact Corrugated Proprietary Limited	Namibia	N$100	N$100	74	74
Subsidiaries-Indirect Holding
Mpact Paarl Property Proprietary
Limited^{4}	RSA	R100	R100	100	100
Mpact Plastic Containers Proprietary
Limited	RSA	R100	R100	66	66
Magic Attitude Trading 57 Proprietary
Limited	RSA	R100	R100	100	100
Detpak South Africa Proprietary Limited	RSA	R7,144	R7,144	51	51
Recycling Consolidated Holdings
Proprietary Limited	RSA	R167,177,219	R167,177,219	100	100
West Coast Paper Traders Proprietary
Limited	RSA	R400	R400	60	60
Mpact Plastic Containers Castleview
Proprietary Limited^{5}	RSA	R1,653,173,811	R496,117,894	66	66
Mpact Flexo Graphics Proprietary
Limited	RSA	R500,000	-	51	-
Mpact Foundation (RF)Proprietary
Limited	RSA	R1	R1	100	100
Associates - Indirect Holding
Farmpack Proprietary Limited^{6}	RSA	R100	R100	49	49
Seyfert Corrugated Western Cape
Proprietary Limited	RSA	R15,500,201	R15,500,201	49	49
Ikhwezi Industries Proprietary Limited^{7}	RSA	R1,000	R1,000	24	24
Africa Tanks Proprietary Limited^{8}	RSA	R16,634,017	-	30	-
Joint arrangement - Indirect holding
Dalisu Holdings Proprietary Limited	RSA	R 100	R100	49	49
Controlling interests in Trusts
Mpact Foundation Trust	RSA	-	-	-	-
Mpact Limited Incentive Scheme Trust	RSA	-	-	-	-

1 The remaining 10% is ultimately held by Mpact Foundation Trust. The trust is controlled by Mpact Limited.
2 The entity was deregistered in the current year.
3 An additional investment was made in the current year.
4 In the current year, Mpact Versapak Proprietary Limited changed its name to Mpact Paarl Property Proprietary Limited.
5 The increase in the share capital is due to a group reorganisation between Mpact Plastic Containers Proprietary Limited and Mpact Plastic Containers Castleview Proprietary Limited.
6 Previously referred to as Lomina Vyf Proprietary Limited.
7 The 24% holding is held by West Coast Paper Traders Proprietary Limited.
8 The 30% holding is held by Mpact Plastic Containers Castleview Proprietary Limited.

These companies operate principally in the countries in which they are incorporated. Refer to note 8 for the cost of investment in subsidiaries.

MPACT LIMITED 39

MPACT LIMITED

NOTES TO THE ANNUAL FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

29. DIRECTORS REMUNERATION

Executive directors' remuneration

The remuneration of the executive directors all of which are paid by Mpact Limited Group, who served during the period under review was as follows:

R's Executive Directors 2024	Guaranteed package (TGCOE)¹	Short term incentive - cash portion²	Other³	Sub total Cash based remuneration	Short term incentive - deferred portion (grant value)⁴	Long term incentive - Intrinsic value⁵	Total remuneration
BW Strong	6,850,057	1,709,774	178,902	8,738,733	961,748	3,055,474	12,755,955
JJ Snyman⁶	3,576,208	750,682	1,818	4,328,708	455,606	–	4,784,314
BDV Clark⁷	2,169,543	348,863	142,483	2,660,889	–	1,741,945	4,402,834
Total	12,595,808	2,809,319	323,203	15,728,330	1,417,354	4,797,419	21,943,103
2023
BW Strong	6,508,365	3,571,791	238,085	10,318,241	2,009,132	11,296,805	23,624,178
BDV Clark	4,947,176	2,382,560	182,775	7,512,511	1,340,190	6,440,401	15,293,102
Total	11,455,541	5,954,351	420,860	17,830,752	3,349,322	17,737,206	38,917,280

¹ Guaranteed package (TGCOE) paid for the 12 months of the financial year.
² Short-term incentive (STI) earned on performance for the 2024 financial year, to be paid in March 2025. (2023: STI earned on 2023 performance, paid in March 2024).
³ Other cash benefits include dividend equivalent bonus based on actual bonus shares that vested in March 2024 and other cash benefits.
⁴ Value of the bonus shares to be granted (56.25% of STI) on 1 April 2025, based on 2024 short term incentive performance and vesting in March 2028. (2023: Value of the bonus share to be granted (56.25% of STI) on 1 April 2024 based on 2023 short term incentive performance and vesting in March 2027).
⁵ Intrinsic value is calculated by taking the number of Performance shares expected to vest in March 2025, based on performance over the three-year period ended 31 December 2024, multiplied by the closing Mpact share price at 31 December 2024 (2023: Performance shares expected to vest in March 2024, based on performance over the three-year period ended 31 December 2023, multiplied by the closing Mpact share price at 31 December 2023).
⁶ Appointed on 1 June 2024. Of the total TGCOE amount, R2,626,400 was paid as director of Mpact Limited and R949,808 was paid as a divisional commercial manager of Recycling Consolidated Holdings Proprietary Limited.
⁷ Retired on 31 May 2024.

MPACT LIMITED 40

MPACT LIMITED

NOTES TO THE ANNUAL FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

29. DIRECTORS REMUNERATION (CONTINUED)

Share awards granted to executive directors

The following tables set out the share award grants to the executive directors.

EXECUTIVE DIRECTOR

	Type of award 1,2	Date of award/ grant	Release date	Number of shares awarded/ granted in prior years	Number of shares awarded/ granted during the year	Number of shares vested during the year	Number of shares lapsed or expected to lapse at vesting date	Number of shares held as a 31 December 2024
BW Strong	BSP	Apr 21	Mar 24	84,031	–	84,031	–	–
PSP	Apr 21	Mar 24	379,342	–	379,342	–	–
BSP	Apr 22	Mar 25	77,532	–	–	–	77,532
PSP	Apr 22	Mar 25	259,171	–	–	155,736	103,435
BSP	Apr 23	Mar 26	86,392	–	–	–	86,392
PSP	Apr 23	Mar 26	296,328	–	–	74,082	222,246
BSP	Apr 24	Mar 27	–	73,256	–	–	73,256
PSP	Apr 24	Mar 27	–	333,013	–	133,205	199,808
Total number of shares	1,182,796	406,269	463,373	363,023	762,669

R's

Type of award 1,2	Date of award/ grant	Award/ grant price (Rand)9	Face value of shares awarded/ granted in prior years3	Face value of shares awarded/ granted during the year4	Cumulative effects of share price movement gain/(loss)5	Value of awards vested during the year6	Value of shares lapsed or expected to lapse at vesting date	Market value of shares at 31 December 20247
BSP	Apr 21	20.44	1,717,594	–	551,243	2,268,837	–	–
PSP	Apr 21	20.44	7,753,750	–	2,488,484	10,242,234	–	–
BSP	Apr 22	31.89	2,472,317	–	(182,022)	–	–	2,290,295
PSP	Apr 22	31.89	8,264,367	–	(608,456)	–	4,600,437	3,055,474
BSP	Apr 23	29.28	2,529,886	–	22,134	–	–	2,552,020
PSP8	Apr 23	29.28	8,677,610	–	75,919	–	2,188,382	6,565,147
BSP	Apr 24	27.43	–	2,009,104	154,878	–	–	2,163,982
PSP8	Apr 24	27.43	–	9,133,148	704,056	–	3,934,882	5,902,322
Total market value of shares			31,415,524	11,142,252	3,206,236	12,511,071	10,723,701	22,529,240

MPACT LIMITED 41

MPACT LIMITED

NOTES TO THE ANNUAL FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

29. DIRECTORS REMUNERATION (CONTINUED)

Share awards granted to executive directors (continued)

BDV Clark	Type of award 1,2	Date of award/ grant	Release date	Number of shares awarded/ granted in prior years	Number of shares awarded/ granted during the year	Number of shares vested during the year	Number of shares lapsed or expected to lapse at vesting date	Number of shares held as at 31 December 2024
	BSP	Apr 21	Mar 24	67,849	–	67,849	–	–
	PSP	Apr 21	Mar 24	216,266	–	216,266	–	–
	BSP	Apr 22	Mar 25	58,432	–	–	–	58,432
	PSP	Apr 22	Mar 25	147,755	–	–	88,786	58,969
	BSP	Apr 23	Mar 26	65,379	–	–	–	65,379
	PSP	Apr 23	Mar 26	168,939	–	–	42,235	126,704
	BSP	Apr 24	Mar 27	–	48,865	–	–	48,865
Total number of shares				724,620	48,865	284,115	131,021	358,349

R's

Type of award 1,2	Date of award/ grant	Award/ grant price (Rand)9	Face value of shares awarded/ granted in prior years3	Face value of shares awarded/ granted during the year4	Cumulative effects of share price movement gain/(loss)5	Value of awards vested during the year6	Value of shares lapsed or expected to lapse at vesting date	Market value of shares at 31 December 20247
BSP	Apr 21	20.44	1,386,834	–	445,089	1,831,923	–	–
PSP	Apr 21	20.44	4,420,477	–	1,418,705	5,839,182	–	–
BSP	Apr 22	31.89	1,863,262	–	(137,181)	–	–	1,726,081
PSP	Apr 22	31.89	4,711,567	–	(346,884)	–	2,622,738	1,741,945
BSP	Apr 23	29.28	1,914,546	–	16,750	–	–	1,931,296
PSP8	Apr 23	29.28	4,947,176	–	43,282	–	1,247,615	3,742,843
BSP	Apr 24	27.43	–	1,340,162	103,310	–	–	1,443,472
Total market value of shares			19,243,862	1,340,162	1,543,071	7,671,105	3,870,353	10,585,637

MPACT LIMITED 42

MPACT LIMITED

NOTES TO THE ANNUAL FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

29. DIRECTORS REMUNERATION (CONTINUED)

Share awards granted to executive directors (continued)

	Type of award^{1,2}	Date of award/ grant	Release date	Number of shares awarded/ granted in prior years	Number of shares awarded/ granted during the year	Number of shares vested during the year	Number of shares lapsed or expected to lapse at vesting date	Number of shares held as at 31 December 2024
JJ
Snyman	BSP	Apr 23	Mar 26	13,521	–	–	–	13,521
	BSP	Apr 24	Mar 27	–	16,193	–	–	16,193
	PSP	Jun 24	Mar 27	–	164,166	–	65,666	98,500
Total number of shares				13,521	180,359	–	65,666	128,214

R's

Type of award^{1,2}	Date of award/ grant	Award/ grant price (Rand)^{9}	Face value of shares awarded / granted in prior years^{3}	Face value of shares awarded/ granted during the year^{4}	Cumulative effects of share price movement gain/(loss)^{5}	Value of awards vested during the year^{6}	Value of shares lapsed or expected to lapse at vesting date	Market value of shares at 31 December 2024^{7}
BSP	Apr 23	29.28	395,946	–	3,464	–	–	399,410
BSP	Apr 24	27.43	–	444,106	34,235	–	–	478,341
PSP^{8}	Jun 24	27.43	–	4,502,384	347,080	–	1,939,785	2,909,679
Total market value of shares			395,946	4,946,490	384,779	–	1,939,785	3,787,430

1 Bonus share plan (BSP).
2 Performance share plan (PSP).
3 Face value at award/grant date is the number of shares awarded/granted at the award/grant price.
4 During the year share grants and awards were made at R27.43 per share.
5 Cumulative effects of share price gains and losses represents the market value change between the share value at grant dates, the value of each at vesting, the value of shares lapsing or expected to lapse and the closing market value at 31 December 2024.
6 During the year share awards were vested at a share price of R27.00 per share.
7 The closing share price at 31 December 2024 was R29.54 per share.
8 Assumed a 75% achievement of PSP awarded in 2023, and 60% for awards made in 2024.
9 Award/grant price is the VWAP of Mpact Limited for the fifteen days following the release of Mpact's year-end results.

MPACT LIMITED 43

MPACT LIMITED

NOTES TO THE ANNUAL FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2024

DIRECTORS REMUNERATION (CONTINUED)

Non-executive directors' remuneration	Paid by Mpact Limited		Paid by Mpact Operations (Proprietary) Limited²			Total paid by Group
	Fees paid as Trustee to the Mpact Foundation Trust¹	Total	Fees paid as non-executive director¹	Professional fees	Total	Total
2024
AJ Phillips	–	–	990,457	58,645	1,049,102	1,049,102
ABA Conrad	161,580	161,580	543,371	–	543,371	704,951
F Futwa³	–	–	438,030	–	438,030	438,030
S Luthuli	–	–	1,090,277	–	1,090,277	1,090,277
M Makanjee	81,084	81,084	828,683	–	828,683	909,767
TDA Ross⁴	–	–	513,397	–	513,397	513,397
D Wilson	–	–	790,095	–	790,095	790,095
Total	242,664	242,664	5,194,310	58,645	5,252,955	5,495,619
2023
AJ Phillips	–	–	990,988	–	–	990,988
ABA Conrad	128,751	128,751	487,255	–	–	616,006
NP Dongwana⁵	50,454	50,454	301,852	–	–	352,306
S Luthuli	–	–	764,453	–	–	764,453
M Makanjee	77,224	77,224	728,557	–	–	805,781
TDA Ross	–	–	782,090	–	–	782,090
D Wilson	–	–	514,521	–	–	514,521
Total	256,429	256,429	4,569,716	–	–	4,826,145

¹ The above amounts exclude VAT.
² The Company's main operating subsidiary is Mpact Operations Proprietary Limited, which conducts the vast majority of the business and affairs of the broader Mpact group. The NEDs were therefore appointed to the board of Mpact Operations with effect from 23 September 2022 in which capacity they will continue to attend to the governance of Mpact Operations and its subsidiaries. In their capacity as NEDs of Mpact Operations Proprietary Limited, they will be remunerated for services rendered to Mpact Operations Proprietary Limited.
³ Appointed on 17 May 2024.
⁴ Retired on 6 June 2024.
⁵ Retired on 1 June 2023.

MPACT LIMITED 44

AI assistant

MPACT LIMITED — Annual Report 2024

48763_rns_2025-03-17_9bbb067e-c81d-4d5e-a27a-1452d0f88ec2.pdf

MPACT LIMITED

Contents

DIRECTORS' RESPONSIBILITY STATEMENT AND BASIS OF PREPARATION

APPROVAL OF THE ANNUAL FINANCIAL STATEMENTS

CERTIFICATE BY GROUP COMPANY SECRETARY

CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER RESPONSIBILITY STATEMENT

Independent auditor's report

Report on the audit of the separate financial statements

Our opinion

What we have audited

Basis for opinion

Independence

Our audit approach

Overview

Final materiality

Key audit matters

Other information

Responsibilities of the directors for the separate financial statements

Auditor's responsibilities for the audit of the separate financial statements

Report on other legal and regulatory requirements

REPORT OF THE DIRECTORS

NATURE OF BUSINESS

FINANCIAL RESULTS

STATED CAPITAL

DIVIDENDS

Salient dates with regard to the ordinary dividend

REGISTER OF SHAREHOLDERS

REPORT OF THE DIRECTORS (continued)

INVESTMENT PROPERTY

DIRECTORS

COMPANY SECRETARY

Registered Office

SPONSOR

AUDITOR

FINANCIAL ASSISTANCE BY MPACT LIMITED

REPORT OF THE DIRECTORS (continued)

AUDIT AND RISK COMMITTEE

GOING CONCERN

EVENTS OCCURRING AFTER THE REPORTING DATE

INTEREST OF DIRECTORS AND PRESCRIBED OFFICERS IN SHARE CAPITAL

REPORT OF THE DIRECTORS (continued)

INTEREST OF DIRECTORS AND PRESCRIBED OFFICERS IN SHARE CAPITAL (CONTINUED)

Major shareholders

AUDIT AND RISK COMMITTEE REPORT

INTRODUCTION

COMPOSITION

MEETINGS

AUDIT AND RISK COMMITTEE REPORT (continued)

COMMITTEE ACTIVITIES

EXTERNAL AUDITORS

Independence of external auditors

External auditors' fees

AUDIT AND RISK COMMITTEE REPORT (continued)

External auditors' performance

FINANCIAL STATEMENTS

PROACTIVE MONITORING

SIGNIFICANT MATTERS

AUDIT AND RISK COMMITTEE REPORT (continued)

INTERNAL AUDIT

INTERNAL FINANCIAL CONTROL AND COMPLIANCE

AUDIT AND RISK COMMITTEE REPORT (continued)

Internal financial reporting control

RISK MANAGEMENT

AUDIT AND RISK COMMITTEE REPORT (continued)

IT GOVERNANCE

COMBINED ASSURANCE

MPACT LIMITED

FOR THE YEAR ENDED 31 DECEMBER 2024

AUDIT AND RISK COMMITTEE REPORT (continued)

INTEGRATED REPORT

GOVERNANCE

ASSURANCE

2. REVENUE

Rental income

Dividend income

Management fee income

3. OPERATING PROFIT

MPACT LIMITED Annual Report 2024