Financial results presentation

half-year ended 31 December 2021

18 February 2022

Disclaimer and glossary of terms

Disclaimer

This presentation has been prepared by Rural Funds Management Limited (ACN 077 492 838, AFSL 226 701) (RFM) as the responsible entity of Rural Funds Group (RFF) and has been authorised for release by the Board of RFM. RFF is a stapled security, incorporating Rural Funds Trust (ARSN 112 951 578) and RF Active (ARSN 168 740 805). The information contained in this presentation is not investment or financial product advice and is not intended to be used as the basis for making an investment decision. Please note that, in providing this presentation, RFM has not considered the investment objectives, financial circumstances or particular needs of any particular recipients.

This presentation is not, and does not, constitute an offer to sell or the solicitation, invitation or recommendation to purchase any securities, and neither this presentation nor anything contained herein shall form the basis of any contract or commitment. In particular, this presentation does not constitute an offer to sell, or a solicitation of an offer to buy, any securities in the United States. This presentation must not be released or distributed in the United States. Any securities described in this presentation have not been, and will not be, registered under the US Securities Act of 1933 and may not be offered or sold in the United States except in transactions exempt from, or not subject to, registration under the US Securities Act and applicable US state securities laws.

RFM has prepared this presentation based on information available to it at the time of preparation. No representation or warranty is made as to the fairness, accuracy or completeness of the information, opinions and conclusions contained in this presentation or any other information that RFM otherwise provides. To the maximum extent permitted by law, RFM, its related bodies corporate and its officers, employees and advisers are not liable for any direct, indirect or consequential loss or damage suffered by any person as a result of relying on this presentation or otherwise in connection with it.

This presentation includes 'forward-looking statements'. These forward-looking statements are based on current views, expectations and beliefs as at the date they are expressed. They involve known and unknown risks, uncertainties and other factors that could cause the actual results, performance or achievements of RFF to be materially different from those expressed or implied by the forward-looking statements. Accordingly, there can be no assurance or guarantee regarding these statements and you must not place undue reliance on these forward-looking statements. RFM and RFF disclaim any responsibility for the accuracy or completeness of any forward-looking statements.

Glossary

Adjusted NAV – Net Asset Value (NAV) adjusted for the independent valuation of water entitlements; Adjusted total assets – Total assets adjusted for the independent valuation of water entitlements; ASX – Australian Securities Exchange; AFFO – Adjusted funds from operations, a financial metric used in the REIT sector to measure available cash flow from operations (adjustment relates to non-cash tax expense); Counterpart – A party other than RFF involved in a financial transaction, usually referring to the lessee of a property; CPI – Consumer Price Index; cpu – cents per unit; CY – Calendar year; DPU – Distributions per Unit; DRP – Dividend reinvestment plan; EBITDA – Earnings Before Interest, Taxes, Depreciation and Amortisation; EPU – Earnings per unit; Fair value – Value of an asset as determined by an independent valuation; FY22e – Financial year 2022 end; Gearing – Calculated as external borrowings/adjusted total assets; GL – Gigalitre; Group – Term used for the Rural Funds Group; ha – Hectare(s); HY21 – Half-year ended 31 December 2020; HY22 – Half-year ended 31 December 2021; LVR – Loan to valuation ratio, a bank covenant calculated as debt divided by tangible assets (including water entitlements); Market capitalisation – Total market value of a company's shares on the market; ML – Megalitre; m – Million(s); NAV – Net asset value, calculated as assets less the value of liabilities (does not recognise fair value of water entitlements); P&E – Plant and equipment; REIT – Real Estate Investment Trust; RFF – Rural Funds Group (ASX: RFF); RFM – Rural Funds Management Limited, manager and responsible entity for RFF; TCI – Total comprehensive income; Total assets – Total value of assets as presented on the balance sheet (water entitlements recorded at the lower of cost or fair value); WALE – Weighted average lease expiry.

Presenters

Managing Director Chief Operating David Bryant Tim Sheridan Daniel Yap

Officer

Chief Financial

James Powell General Manager – Investor Relations & Marketing

HY22 financial results 1.
Capital management 2.
Portfolio and strategy update 3.
Conclusion 4.
Appendices 5.

Cattle grazing at Cobungra, in Victoria's high country, October 2021.

Key activities and highlights

Ongoing expansion of the portfolio to drive earnings growth.

Entitlement Offer completed August 2021:
- $100.0m raised to fund the development of 1,000 ha of macadamia orchards and asset acquisitions (8.3 GL water entitlement and additional properties).
- Forecast FY22 AFFO of 11.6 cents per unit (cpu).
Acquisitions announced November 2021:
- Acquisition of three cattle and cropping properties totalling 33,926 ha (including 33.2 GL of water entitlements) and two mature macadamia orchards totalling 475 ha. 1
- Upgraded forecast FY22 AFFO to 11.8 cpu.
Increase of Guarantee associated with JBS operated feedlots February 2022:
- Proposal to increase Guarantee to $132.0m well supported with 99.7% of eligible votes cast 'For' the resolution.2
- Upgraded forecast FY22 AFFO to 11.9 cpu.
Development and leasing activities:
- Development of 1,000 ha of macadamia orchards in Maryborough, Bundaberg and Rockhampton is on track to be materially complete in FY22.
- Australian Agricultural Company (ASX: AAC) to lease Comanche and Homehill.2
- Productivity developments continuing on cattle and cropping properties.

HY22 results highlights

AFFO per unit

5.8 cents on track with FY22f Distributions per unit

5.87 cents 4% on HY21

Earnings per unit3 10.36 cents

32.6% within 30–35% target

Gearing

Adjusted NAV per unit

$2.24 3% on FY21 FY22f distributions per unit

11.73 cents 4% on FY21

1. Includes cattle and cropping property aggregation Kaiuroo, which has a settlement period of up to November 2023.
1. The lease is subject to approval by the Foreign Investment Review Board.
1. Earnings calculated TCI/weighted average units (see page 22).

Property movements

Acquisitions in cropping, cattle and macadamia sectors.

Adjusted property assets movements ($m) by sector1

Key contributors to the adjusted property assets movements:
- Cropping: acquisition of 8.3 GL Murrumbidgee Groundwater entitlement and Baamba Plains for $70.9m and development capex of $3.3m (primarily on Lynora Downs and Mayneland).2
- Cattle: acquisition of The Pocket and Coolibah for $19.5m, deposit for Kaiuroo of $17.2m, revaluations of $17.6m (including Rewan $12.0m, WA properties $2.2m and Yarra $2.9m) and development capex of $2.5m.3
- Macadamias: acquisition of two mature orchards (Beerwah and Bauple) for $58.2m and development capex of $12.7m.4
- Other: includes development capex and depreciation. 5
For details of independent valuations see page 27.
1. The sector totals presented in the chart are net of written-off transaction costs and inclusive of capex. Acquisition amounts include stamp duty. Revaluations include straight-lining adjustment for rent and finance lease adjustments. Adjusted property assets include plant and equipment (P&E). Directors' valuation applied to bearer plants where applicable, which are treated as property, plant and equipment and depreciated in accordance with AASB116.
1. Cropping: acquisitions include Murrumbidgee Groundwater (Aug 2021 $38.4m) and Baamba Plains (Nov 2021 $32.5m). Other movements: revaluation of $0.4m, net of transfer of Maryborough cropping property to macadamia property for $3.5m, plant and equipment disposal of $0.3m and depreciation of $0.3m.
1. Cattle: acquisitions include The Pocket, to be referred to as Yarra (Dec 2021 $14.6m), River Block and Coolibah, referred to as Coolibah (Dec 2021 $4.9m). Revaluation includes property revaluations of $17.1m and finance lease adjustment of $0.5m. Other movements: breeder cattle $0.2m and P&E of $0.3m, net of derecognition of finance lease for $0.5m.
1. Macadamia: Beerwah and Bauple acquisition excludes shares in Marquis Macadamias Limited as part of the transaction. Other movements: transfer of Maryborough cropping property to macadamia property for $3.5m, P&E of $2.4m, revaluation of $1.4m, net of depreciation of $0.7m. Revaluation includes properties' revaluations of $1.2m and finance lease adjustment of $0.2m.
1. Other: development capex of $1.8m for almond orchards and vineyards, net of disposal of a portion of surplus land on Kerarbury for $1.6m, bearer plants depreciation of $2.0m, P&E disposal of $0.2m and revaluation of $0.2m. Revaluation includes straight-lining adjustment for rent of $0.2m.

Earnings and balance sheet summary

HY22 AFFO and DPU on track for full-year forecasts. FY23 forecast distributions announced.

Income and earnings metrics

Balance sheet summary

	6 months ended31 December 2021	6 months ended31 December 2020
Property revenue–$	34,855,000	33,916,000
Total comprehensive income (TCI)–$	38,807,000	58,425,000
Earnings per unit (EPU)1 –cents	10.36	17.26
Adjusted funds from operations (AFFO)–$	21,791,000	22,170,000
AFFO per unit–cents	5.8	6.6
AFFO payout ratio	101%	85%
Distributions per unit (DPU) –cents	5.87	5.64

Property revenue increased primarily due to income from the increased J&F Guarantee, acquisitions, development capital expenditure and lease indexation. Prior corresponding period included $2.9m lease income from Mooral almond orchard (sold for $98.0m December 2020).

TCI and EPU driven by positive revaluations primarily on cattle properties within the portfolio. Prior corresponding period included the gain on sale of $32.5m (primarily Mooral almond orchard - refer page 22).

AFFO per unit forecast to increase in 2H22 due to contribution of increased J&F Guarantee and acquisitions.4 FY22 forecast AFFO of 11.9 cpu.

FY22 forecast DPU of 11.73 cents confirmed. FY23 forecast DPU of 12.20 cents (inclusive of franking credits) representing 4% increase on FY22f.5

As at 31 December 2021 As at 30 June 2021 Total assets – $ 1,254,374,000 1,041,904,000 Adjustment for water at fair value – $ 90,300,000 90,178,000 Adjusted total assets2– $ 1,344,674,000 1,132,082,000 External borrowings – $ 438,693,000 346,550,000 Gearing3– $ 32.6% 30.6% Net asset value (NAV) – $ 764,688,000 648,544,000 NAV per unit – $ 2.00 1.91 Adjusted NAV2 – $ 854,988,000 738,722,000 Adjusted NAV per unit1 – $ 2.24 2.17
Assets increased primarily due to acquisitions and revaluations.

Borrowing increased due to acquisitions. Gearing of 33% within 30–35% target range.

Net assets increased primarily due to revaluations.

• Refer to pages 22 to 26 for further information.

Notes:

Earnings calculated TCI/weighted average units (see page 22).
Assets adjusted for the independent valuation of water entitlements which are recognised at the lower of cost or fair value on balance sheet.
Gearing calculated as external borrowings/adjusted total assets.
Acquisitions to contribute 2H22 including 8,338 ML Murrumbidgee Groundwater, mature macadamia orchards – Beerwah and Bauple and cattle and cropping properties – The Pocket, Baamba Plains & Kaiuroo (deposit only).
FY23 DPU to include franking credits. Cash distribution to be at least 11.73 cpu.

Header harvesting chickpeas at sunset, Lynora Downs, central Queensland, November 2021.

Capital management

Refinance of debt facility and forward dated interest rate hedges acquired.

Equity		Debt
Item	Details	Item	Details
Equity raised	Entitlement Offer completed August 2021 ($100.0m at $2.47 per unit) to providefunding for acquisitions and macadamia orchard developments.	Facility	Increase of debt facility limit, extension of tenor and increase of LVR covenant to55%. Introduction of third lender to the debt syndicate and margin refinance for$110.0m expected to be completed February 2022.
Distribution	Forecast FY22 DPU of 11.73 cents. An increase of 4% from FY21.Forecast FY23 DPU of 12.20 cents. An increase of 4% from FY22.2	Limit	Facility limits increased to $520.0m.
DRP	Remains open with 1.5%discount.HY22 average DRP participation 15%.	Maturity	Expiry date November 2023 ($110.0m) and November 2024 ($410.0m).
Trading price	Increase of19.6%($2.65to$3.17)from30 June 2021to31 December2021. Currentprice $2.96 (8 February 2022).	Hedging	Interest rate hedges totalling $140.0m entered into during the six-month periodended 31 December 2021. Weighted average duration of 13.7 years (includingforward start period) at weighted average rate of 2.39%.

Equity raises, RFF share price and total return (compared to S&P/ASX 300 A-REIT accumulation index) 1

Notes:

Calculation period 1 July 2014 to 8 February 2022. S&P/ASX 300 A-REIT Accumulation Index rebased to $1.00. RFF total return rebased to $1.00 and assumes dividends reinvested. RFF total return does not take into account the benefit of participating in equity raises. Market capitalisation (Mkt cap) amounts are subject to rounding.
FY23 DPU to include franking credits. Cash distribution to be at least 11.73 cpu.

Debt facility and interest rate hedges

Additional forward dated interest rate hedges to decrease future weighted average hedge rate.

Debt facility metrics

		31 December 2021	30 June 2021
	Term debt facility limit 1, 2	$520.0m	$380.0m
	Term debt drawn	$436.0m	$344.1m
Debt facility	Headroom	$84.0m	$35.9m
	Cost of debt 3	3.22%	3.20%
	Loan to Value Ratio (LVR) 1, 4	43.5%	41.9%
Covenants	Interest Cover Ratio (ICR) 1	5.00	8.10
	Adj. Net Tangible Assets (NTA) 1	$855.0m	$738.7m
	Total amount hedged 5	$183.0m	$183.0m
Hedging	Proportion debt hedged 1, 6	42.0%	53.2%
	Weighted average duration 7	9.3 years	7.5 years

Interest rate hedges (FY22 to FY26)

Debt facility tenor

Debt drawn Undrawn

1. Key financial covenants HY22: LVR <55%, ICR >3.00x, with distribution permitted at >3.15x, Adj. NTA including water entitlements >$400m, undertaking to maintain minimum 40% hedging requirement. Hedging requirement may vary with bank consent.
1. Security: real property mortgages, general security agreement, cross guarantees between RFF and subsidiaries.
1. Total interest expense plus cost of hedges, divided by average term debt drawn.
1. LVR calculated as term debt drawn plus guarantee of $99.9m (as at 31 Dec 2021) divided by directly secured assets based on independent valuations. Guarantee increased to $114.0m in February 2022.
1. Current hedges only.
1. Proportion hedged calculated as current hedges/term debt drawn.
1. Duration remaining as at 31 December 2021 and includes forward start hedges.

Macadamia orchard developments at Riverton, Rockhampton – central Queensland, December 2021.

Portfolio overview

RFM has experience developing and operating agricultural properties in all sectors in which RFF leases assets.

Assets map, sector information and key lessees1

Almonds	40%
Properties:	3
Description:	1,006ha of mature orchards, 3,133haof maturing orchards.
HY22 value:	$380.3m
FY22f revenue:	$28.2m (40%)
Water entitlements:	55,396 ML
Corporate andlisted lessees:	OlamSELECT HARVESTS
Cropping	9%
Properties:	23
Description:	15,780 ha of irrigated cropping anddryland cropping land.
HY22 value (m)	$188.3m
FY22f revenue:	$6.7m (9%)
Water entitlements:	60,280 ML
Corporate andlisted lessees:	QUEENSLAND COTTON
Macadamias	2%

perties:	15
scription:	1059 ha of planted area.
'22 value:	$148.4m
22f revenue:	$1.3m(2%)
iter entitlements: 5,893 ML

Note:

Shaded areas denote climatic zones differentiated by rainfall seasonality (source: Bureau of Meteorology); see Climatic Diversification discussion paper dated 20 June 2016. Numbers in the circles/boxes on map show number of assets. Natal cattle property aggregation previously shown as three properties now shown as one. Cattle property Kaiuroo, which has a settlement period of up to November 2023, included in number of properties; value of deposit and interest on deposit included in HY22 value and FY22f revenue. Blue square boxes denote cattle feedlots. Murrumbidgee HS water entitlement (8,754 ML) with a value of $65.2m not shown. "FY22f revenue" excludes revenue from owner occupied properties that the Group is currently operating (Beerwah & Bauple - Macadamias; unleased Maryborough properties and Baamba Plains - Cropping; Yarra - Cattle). See page 16 note 1 for description of corporate and listed lessees. 12

Central Queensland cattle and cropping properties

Comanche and Homehill leased to AAC following productivity developments. 1

Central Queensland properties

Leasing update:

Australian Agricultural Company (ASX: AAC) have entered a 10-year lease of Comanche and Homehill, commencing May 2022.1 The lease includes a market rent review in year five and annual indexation.
- AAC previously backgrounded cattle on Comanche and Homehill while productivity developments were undertaken.2
- AAC to background cattle on other unleased RFF properties while productivity developments progress.2

Acquisition and development update:3

All "new acquisitions" forecast to contribute to 2H22 revenue:
- Baamba Plains (4,130 ha cropping property with 14.0 GL water entitlements); RFM to operate and commence productivity developments prior to leasing.
- The Pocket (1,917 ha cattle and cropping property with 5.4 GL water entitlements); RFM to operate and commence productivity developments prior to leasing.
- Kaiuroo (27,879 ha cattle and cropping aggregation with 12.5 GL water entitlements); RFM to commence developments during settlement period. Income to be received on deposit amount paid.
- Coolibah (724 ha cattle property aggregation) currently licenced on short-term basis.
1. The lease is subject to approval by the Foreign Investment Review Board.
1. Under the backgrounding arrangement RFF is paid a fee based on cattle weight gain.
1. Kaiuroo has a settlement period of up to November 2023, Baamba Plains settled November 2021, The Pocket and Coolibah settled December 2021. RFM operating Baamba Plains and The Pocket/Yarra on behalf of RFF.

Macadamia orchards update

Stage one macadamia orchard developments expected to be materially complete in FY22.

Macadamia orchard locations

Development update:

'Stage one' macadamia orchard development of 1,000 ha is on track to be materially complete in FY22.
- 375 ha developed to date: minor delays due to above average rainfall over December/January and availability of materials and contractors.

Leasing update:

Discussion with several institutional investor lessees occurring.
- As orchards mature, value increases.
Lease of Nursery Farm completed November 2021 following the expansion of the macadamia tree nursery output. The arrangement provides supply of trees for RFF developments.

Acquisitions update:

Beerwah and Bauple (475 ha mature macadamia orchards, settled December 2021); RFM to commence productivity developments prior to leasing.
- Mature orchards immediate income generation complements the orchard developments for potential lessees.
- Operating revenue forecast to be received in 2H22.

Revenue and WALE

Organic growth from macadamia, cattle and cropping development pipeline.

FY22f revenue by sector and year of lease expiry1

Note:

Figures shown are subject to rounding. Shown by FY22f revenue. Weighted average lease expiry (WALE) is calculated as the FY22 forecast rent and the year of lease expiry, Excludes income from annual water allocation sales, revenue from owner occupied properties and agistment. Revenue from owner occupied properties include Beerwah & Bauple - Macadamias; unleased Maryborough properties and Baamba Plains - Cropping; Yarra - Cattle.

Counterparties and indexation

Growth in lease revenue supported by annual indexation and market rent reviews.

Most lease revenue is sourced from listed and corporate foodproducing businesses.
- Broadly, agricultural operators are currently experiencing good seasons and commodity prices.
- No rent relief has been required due to COVID-19.
Lease indexation mechanisms:
- 44% lease income based on CPI.
- 39% of lease revenue has an annual escalator (CPI or fixed) and a market rent review mechanism.
  - Market rent reviews primarily seek to monetise productivity gains (see slide 28).
Leases are largely triple-net, with cost of development capex leased to operators.
1. Figures shown are subject to rounding. Lessees shown by FY22f revenue. Olam refers to Olam Orchards Australia Pty Ltd, a wholly-owned subsidiary of SGX-listed Olam International Ltd (SGX: O32). Income from J&F Australia Pty Ltd attributed to JBS Australia. Cotton JV income split 50% RFM and 50% listed and corporate (Queensland Cotton Corporation Pty Ltd). Excludes income from annual water allocation sales, revenue from owner occupied properties and agistment. Revenue from owner occupied properties include Beerwah & Bauple - Macadamias; unleased Maryborough properties and Baamba Plains - Cropping; Yarra - Cattle.
1. 'Other' in revenue by lease indexation mechanisms, includes: J&F guarantee fee, other short term leases, revenue from Kaiuroo deposit and cattle finance leases. Excludes revenue from owner occupied properties (see note 1).

Sustainability

Evolution of RFM's approach to environmental, social and governance (ESG) initiatives and developing a sustainability framework.

Pre-FY21	FY21	FY22	TahenProject update
•Policies and procedures which address ESGissues, including the environment, animaltreatment and welfare, WHSE (workhealth,safety and environment), incidentmanagement, diversity and equal opportunity,compliance, conflicts of interest managementand code of conduct.•Acknowledgement of the potential risks thatclimate change could present to RFF's assets.•Commitment to continue to monitor emissionsand seek to implement infrastructure andpractice changes as part of its ongoing strategyto mitigate and improve climate-related risks.•Leases require operators to use appropriateagricultural production methods, includingminimising environmental impact, protectingbiodiversity, manage water and sustain soilhealth.•ESG reporting in Annual Report.	•Expanded ESG reporting in Annual Report toinclude specific projects and actions RFM isundertaking which seek to improveenvironmental outcomes, including:•Beef herd management projects.•Soil carbon sequestrationmeasurement.•Reforestation assessment.•Emissions assessments.•Solar energy projects.•Environmental impact assessments.•Implementation of an improved online safetysystem.•RFM continues to provide support to the TahenProject. The aim of the TahenProject is toeducate and mentor local farmers to developmore modern, sustainable and diversifiedagricultural enterprises. RFM has committed toproviding $1.0m over three years, as well asongoing advice and support to achieve this aim.	•Projects expanded to include the followingobjectives:•Identifying appropriate sustainabilityreporting framework(s).•Assessing emissions quantification.•Ongoing assessment of environmentalprojects, also in conjunction withlessees where appropriate.•Additional independent director appointed tothe RFM board: MsAndrea Lemmon.	Learn more:The above image shows a rice field at Tahen. Since the

Tahen Project commenced in 2019, total rice production has increased from 1.5 t/ha to the overall 2022 forecast crop of 3.3 t/ha. Tahen, Cambodia, February 2022.

Cotton under pivot irrigation, Lynora Downs – central Queensland, February 2022.

Performance metrics

Established track record of maintaining distribution growth of at least 4% per annum.

Performance metrics (includes FY22 and FY23f)1

Conclusion

Development pipeline in macadamia, cropping and cattle sectors.

1. Entitlement Offer completed August 2021 provided funding for acquisitions and developments:
- Stage one of macadamia developments on track to be materially complete in FY22.
- Cropping and cattle property acquisitions completed in HY22.

2. Leasing update:

AAC entered lease for Comanche and Homehill. Backgrounding arrangements in place for other unleased cattle properties while developments progress. 1
Discussion with several institutional investor lessees occurring. As orchards mature, value increases.
3. FY23 forecast distributions of 12.20 cpu (inclusive of franking credits)2 :
- Representing 4% gross DPU growth.
- Large portion of leases include CPI-linked indexation and market rent reviews.

RURAL FUNDS GROUP (ASX: RFF)

ASX-listed agricultural Real Estate Investment Trust (REIT). Included in the S&P/ASX 300 index ($1.1b mkt cap).
Owns a diversified portfolio of agricultural assets leased predominantly to corporate operators.
Target distribution growth of 4% per annum.
Acquisition strategy includes targeting sectors where Australia has a comparative advantage and RFM has operational experience.
Income growth achieved through lease indexation, productivity improvements and conversion of assets to higher and better use.
Managed by a specialist agricultural farm and fund manager with 25 years of experience.
1. The lease is subject to approval by the Foreign Investment Review Board. Under the backgrounding arrangement RFF is paid a fee based on cattle weight gain.
1. FY23 DPU to include franking credits. Cash distribution to be at least 11.73 cpu.

Expanded macadamia tree nursery, Bundaberg, central Queensland, February 2022.

HY22 results – summarised comprehensive income

Property revenue has increased primarily due to the income from new acquisitions, development capital expenditure, lease indexation and increase in J&F guarantee income offset by a decrease due to the sale of Mooral.
Other income largely relates to income from cropping operations and unleased Murrumbidgee High Security Water annual allocation sales.
Property and other expenses increased largely due to costs associated with property acquisitions and properties under development, and an increase in insurance costs.
Finance costs decreased as a result of lower funding costs.
Depreciation and impairments related mainly to plant and equipment owned within RF Active.
Change in fair value to financial assets primarily related to shares owned in macadamia processing company Marquis Macadamias Limited.
Change in fair value of biological assets relates to cropping operations (harvested and unharvested) on Maryborough properties.
Property revaluations of $11.0m (including bearer plants, investment property, property-owner occupied, and intangibles).
Income tax expense relates to RF Active and AWF.1 RFT treated as a flowthrough trust for tax purposes.

Notes:

1. RFM Australian Wine Fund (AWF) is a subsidiary of Rural Funds Trust (RFT) that has formed its own tax consolidated group.
1. Calculated 1.05% adjusted total assets excluding macadamia properties under development and Kaiuroo deposit.

Summarised statement of comprehensive income

	6 months ended	6 months ended
	31 December 2021	31 December 2020
	$	$
Property revenue	34,855,000	33,916,000
Revenue	34,855,000	33,916,000
Other income	6,941,000	2,859,000
Cost of goods sold	(3,765,000)	-
Property expenses	(2,217,000)	(1,156,000)
Other expenses	(3,093,000)	(2,491,000)
Management fees2	(5,578,000)	(5,424,000)
Finance costs	(5,132,000)	(5,280,000)
Gain on sale of assets	54,000	32,538,000
Depreciation and impairments	(497,000)	(268,000)
Property revaluations–Bearer plants	(4,405,000)	(2,019,000)
Property revaluations–Investment property	17,962,000	5,832,000
Property revaluations–Intangible assets	(1,454,000)	(467,000)
Property revaluations–Property-owner occupied	(1,668,000)	(1,651,000)
Change in fair value of financial assets/liabilities	325,000	(24,000)
Change in fair value of biological assets	1,766,000	-
Change in fair value of derivatives	5,581,000	2,939,000
Profit before tax	39,675,000	59,304,000
Income tax expense	(1,468,000)	(879,000)
Profit after tax	38,207,000	58,425,000
Other comprehensive income	600,000	-
Total comprehensive income	38,807,000	58,425,000
Weighted average units	374.6m	338.4m
Earnings per unit3	10.36 cents	17.26 cents

HY22 results – AFFO composition

• AFFO is pre-tax and excludes fair value adjustments, depreciation and impairment to represent RFF's property rental business.

Property expenses relate to costs directly attributable to the properties (e.g. insurance, rates and taxes on properties, applicable cost recovery). Other expenses relate to non-property overheads (e.g. ASX, bank, audit, registry fees, cost recovery).
Other income includes harvest income from cropping operations on Maryborough properties. Cost of goods sold relates to the harvested cropping operations. Change in fair value of biological assets relates to the profit recognised for the harvested crops during the year.
Property leases are largely triple net.

Composition of AFFO (pre-tax)
-------------------------------	--	--

	6 months ended31 December 2021$	6 months ended31 December 2020$
Property revenue	34,481,000	33,899,000
Property expenses	(2,217,000)	(1,156,000)
Net property income	32,264,000	32,743,000
Other income	6,941,000	2,859,000
Cost of goods sold	(3,765,000)	-
Change in fair value of biological assets (harvestedcrops)	1,435,000	-
Other expenses	(3,093,000)	(2,491,000)
Management fees	(5,578,000)	(5,424,000)
EBITDA	28,204,000	27,687,000
Income tax payable (RF Active)	(1,281,000)	(237,000)
Financecosts	(5,132,000)	(5,280,000)
AFFO	21,791,000	22,170,000
AFFO per unit1	5.8 cents	6.6 cents
DPU	5.87 cents	5.64 cents

HY22 results – reconciliation of net profit to AFFO

Reconciliation of net profit after tax to AFFO

	6 months ended	6 months ended
	31 December 2021	31 December 2020
	$	$
Netprofit afterincome tax	38,207,000	58,425,000
Adjusted for:
Property revaluations	(12,582,000)	(3,714,000)
Depreciation–Bearer plants	2,147,000	2,019,000
Depreciation and impairment	497,000	268,000
Gain on sale of assets	(54,000)	(32,538,000)
Straight-lining of rental income	100,000	521,000
Interest component of JBS feedlot finance lease	(474,000)	(538,000)
Change in fair value of biological assets (unharvestedcrops)	(331,000)	-
Change in fair value of financial assets/liabilities	(325,000)	24,000
Changein fair value of interest rate swaps	(5,581,000)	(2,939,000)
FFO	21,604,000	21,528,000
Adjusted for income tax expense	187,000	642,000
AFFO	21,791,000	22,170,000
AFFO per unit1	5.8 cents	6.6 cents

Non-cash items added back to reconcile net profit after tax to AFFO.
Key adjustments include:
- Property revaluations (excluding other comprehensive income) includes $17.1m in cattle properties, ($1.1m) in cropping properties and ($3.4m) in macadamia properties.
- Depreciation and impairments related mainly to plant and equipment owned within RF Active.
- Straight-lining reflects a smoothing of rent earned over a lifetime of the lease (under AASB16 for leases with fixed indexation).
- Interest component of JBS feedlot finance lease reflects indexation due to finance lease classification.

HY22 results – summarised balance sheet

Water entitlements are recorded as intangible assets, and held at the lower of cost less accumulated impairment or fair value in accordance with accounting standards and ASIC guidance. The adjustment for water entitlements shows the difference between book value and fair value (based on current independent valuations).
Water entitlements total 149.5 GL and water delivery entitlements total 21.4 GL, representing a fair value of $259.5m or 19% of total adjusted assets.
See page 27 for details of independent valuations.

	As at	As at
	31 December 2021	30 June 2021
	$	$
Cash	11,709,000	11,647,000
Property investments	1,197,649,000	1,002,341,000
Plant and equipment	15,871,000	8,716,000
Current tax receivable	-	477,000
Derivative financial assets	2,606,000	2,930,000
Other assets	26,539,000	15,793,000
Total assets	1,254,374,000	1,041,904,000

Interest-bearing liabilities:
–Current	2,745,000	2,456,000
–Non-current	436,000,000	344,143,000
Derivative financial liabilities	15,768,000	21,673,000
Current tax liabilities	195,000	-
Deferred tax liabilities	7,637,000	7,450,000
Other liabilities	27,341,000	17,638,000
Total liabilities	489,686,000	393,360,000
Net assets	764,688,000	648,544,000

Units on issue	381,367,182	339,900,556
NAV per unit	2.00	1.91
Adjustment for water entitlements fair value per unit	0.24	0.26
Adjusted NAV per unit	2.24	2.17

HY22 results – total assets reconciliation

Total assets reconciliation

	Investmentproperty	Bearerplants	Intangibleassets1, 3	Property-owneroccupied	Financial assets–property2, 3	Plant andequipment	Deposits5	Other assets	Total	Adjustment forwaterentitlements atfair value1, 3	Adjustedtotal assets
Balance as at 30 June 2021	$598,545,000	$160,782,000	$110,418,000	$28,284,000	$104,312,000	$8,716,000	$-	$30,847,000	$1,041,904,000	$90,178,000	$1,132,082,000
Additions –Cattle	18,111,000	-	3,811,000	-	421,000	174,000	17,188,000	-	39,705,000	-	39,705,000
Additions –Cropping	1,968,000	-	6,056,000	26,634,000	-	2,575,000	-	-	37,233,000	-	37,233,000
Additions -Almond orchard	952,000	304,000	-	-	-	-	-	-	1,256,000	-	1,256,000
Additions –Macadamias	13,417,000	37,934,000	-	20,104,000	335,000	5,634,000	-	-	77,424,000	-	77,424,000
Additions –Vineyards	567,000	-	-	-	-	-	-	-	567,000	-	567,000
Additions –Water (cropping)	-	-	38,389,000	-	-	-	-	-	38,389,000	-	38,389,000
Disposals	(1,621,000)	-	-	-	(532,000)	(381,000)	-	-	(2,534,000)	-	(2,534,000)
Depreciation and impairments	-	(2,147,000)	-	(14,000)	-	(483,000)	-	-	(2,644,000)	-	(2,644,000)
Fair value adjustment4	17,962,000	(1,658,000)	(1,454,000)	(1,668,000)	(24,000)	-	-	349,000	13,507,000	122,000	13,629,000
Other movements	(100,000)	-	-	-	373,000	(364,000)	-	9,658,000	9,567,000	-	9,567,000
Balance asat 31 December 2021	649,801,000	195,215,000	157,220,000	73,340,000	104,885,000	15,871,000	17,188,000	40,854,000	1,254,374,000	90,300,000	1,344,674,000

1. Accounting standards and ASIC guidance require water entitlements to be recorded as intangible assets, and held at the lower of cost less accumulated impairment or fair value. The adjustment for water entitlements shows the adjustment to the fair value of the water entitlements held.
1. Relates to water entitlements held as part of the investment in Barossa Infrastructure Limited, Coleambally Irrigation Co-operative Limited, breeder herd finance lease, loan to Camm, straight-lined asset, equipment finance leases and finance lease with JBS Australia for five feedlots, which are accounted for as financial assets.
1. Water entitlements of 149,557 ML and 21,430 ML of water delivery entitlements held by the Group representing a fair value of $259.5m.
1. Fair value adjustments as part of valuations for the half-year ended 31 December 2021.
1. Relates to $17.2m deposit paid on Kaiuroo, which has a settlement period of up to November 2023. The Group will receive interest on the deposit amount prior to settlement. 26

Valuations and valuers

Policy to conduct independent valuations at least every two years and rotation of valuers every five years.

	Property by sector	State	Brief description	Acquisition date	Adjusted property value31 December 2021	Valuation date (reporting date)	Valuation	Valuer
Almonds	Yilgah	NSW	1,006 ha orchard	Jun-2008	$105.6m	Jun-2021	$107.0m	JLL
	Tocabil	NSW	603 ha orchard	Oct-2014	$49.2m	Jun-2021	$49.0m	JLL
	Kerarbury	NSW	2,530 ha orchard	Oct-2015	$225.3m	Jun-2021	$228.0m	JLL
Cattle	Rewan	QLD	17,479 ha property	Aug-2016	$62.4m	Dec-2021	$62.4m	LAWD
	Mutton Hole	QLD	140,300 ha property	Jul-2016	$16.8m	Jun-2021	$16.7m	Herron Todd White
	Oakland Park	QLD	85,500 ha property	Aug-2016	$8.6m	Jun-2021	$8.5m	Herron Todd White
	Natal Aggregation	QLD	390,600 ha property	Dec-2017	$89.0m	Jun-2021	$88.5m	JLL
	Comanche	QLD	7,600 ha property	Jul-2018	$24.5m	Jun-2020	$22.0m	CBRE
	Cerberus	QLD	8,280 ha property	Sep-2018	$14.1m	Jun-2020	$13.8m	CBRE
	Dyamberin	NSW	1,729 ha property	Oct-2018	$14.0m	Jun-2020	$13.9m	Colliers
	Woodburn	NSW	1,063 ha property	Jan-2019	$7.4m	Jun-2020	$7.3m	Colliers
	Cobungra	VIC	6,497 ha property	Mar-2019	$40.8m	Jun-2021	$40.8m	Colliers
	Petro, High Hill & Willara (WA properties)	WA	6,195 ha property	Feb-2020	$25.3m	Dec-2021	$24.4m	Herron Todd White
	JBS Caroona, Mungindi, Prime City, Beef City, Riverina	NSW/QLD	150,000 head feedlots (total)	Oct-2018	$56.1m	N/A	N/A	Purchase price
	Homehill	QLD	4,925 ha property	Jun-2020	$13.4m	Jun-2020	$11.8m	CBRE
	Yarra	QLD	4,090 ha property	May-2020	$23.6m	Dec-2021	$23.6m	CBRE
	Coolibah	QLD	724 ha property	Dec-2021	$4.9m	N/A	N/A	Purchase Price
Cropping	Lynora Downs	QLD	4,963 ha property	Dec-2016	$41.7m	Jun-2021	$41.5m	JLL
	Mayneland	QLD	2,942 ha property	Sep-2018	$23.7m	Dec-2021	$23.3m	CBRE
	Maryborough	QLD	3,745 ha property	Nov-2020	$50.5m	Dec-2020	$50.3m	CBRE
	Baamba Plains	QLD	4,130 ha property	Nov-2021	$30.0m	Dec-2021	$30.0m	CBRE
Macadamias	Swan Ridge	QLD	130 ha orchard	Mar-2016	$7.0m	Dec-2021	$7.0m	CBRE
	Moore Park	QLD	104 ha orchard	Mar-2016	$4.5m	Dec-2021	$4.6m	CBRE
	Bonmac	QLD	27 ha orchard	Mar-2016	$3.2m	Dec-2021	$3.2m	CBRE
	Cygnet	QLD	37 ha orchard	Oct-2019	$3.1m	Jun-2021	$2.8m	Herron Todd White
	Swan Ridge South	QLD	123 ha property	Mar-2020	$1.6m	Dec-2021	$1.6m	CBRE
	Nursery Farm	QLD	41 ha orchard	Mar-2020	$7.0m	Jun-2021	$3.8m	Herron Todd White
	Riverton	QLD	1,015 ha property	Nov-2020	$9.5m	Jun-2021	$4.5m	CBRE
	Rookwood Farms	QLD	2,452 ha property	Dec-2020	$10.6m	Jun-2021	$7.1m	CBRE
	Maryborough	QLD	1,513 ha property	Nov-2020	$34.8m	Dec-2020	$24.3m	CBRE
	Beerwah	QLD	340 ha property	Dec-2021	$36.3m	Dec-2021	$36.3m	CBRE
	Bauple	QLD	135 ha property	Dec-2021	$18.4m	Dec-2021	$18.4m	CBRE
Vineyards	Kleinig	SA	206 ha vineyard	May-2002	$22.8m	Jun-2021	$23.1m	JLL
	Geier	SA	243 ha vineyard	Sep-2000	$27.8m	Jun-2021	$27.7m	JLL
	Dohnt	SA	30 ha vineyard	Sep-2004	$1.2m	Jun-2021	$1.2m	JLL
	Hahn	SA	50 ha vineyard	Feb-2000	$5.0m	Jun-2021	$5.1m	JLL
	Mundy and Murphy	SA	55 ha vineyard	Apr-2000	$4.1m	Jun-2021	$4.1m	JLL
Water	Rosebank	VIC	82 ha vineyard	Aug-2003	$3.8m	Jun-2021	$3.8m	JLLJLL
	Ground water	NSW	8,338 ML	Aug-2021	$38.4m	Dec-2021	$38.4m
	Unencumbered water entitlement - River	QLD	3,710 ML	Jan-2020	$ 1.1m	Jun-2020	$1.1m	CBRE
	Unencumbered water entitlement - River	NSW	8,754 ML	Dec-2016	$65.7m	Jun-2021	$65.7m	JLL
	Adjusted property assets				$1232.8m		$1146.6
	Cattle financial lease and other assets				$35.1m
	Plant & equipment				$15.9m
	Other receivables and equipment leases				$2.8m
	Kaiuroo deposit				$17.2m			Rural F
	Total adjusted property assets				$1303.8m

Development assets and capital expenditure

Productivity and higher and better use developments underway across most sectors.

Development and capital expenditure summary1

	Property	State	Acquisitiondate	Rentreview	Developmenttype	Initial	Five-yeardevelopments	1H22	2H22f	FY23f	Totalforecast
Cattle	Mutton Hole & Oakland Park	Qld	Jul 2016	Yr5	Water points	102	21
				Yr 5	Pasture improvement	20,000 ha	33,333 ha
	Rewan	Qld	Oct 2019	Yr 5	Water points	82	0
					Cultivation area	3,432 ha	250 ha
					Pasture improvement	645 ha	200 ha
	Natal aggregation	Qld	Dec 2017	Yr 5	Water points	96	50
	Cerberus	Qld	Sep 2018	Yr 5	Cultivation area	0 ha	600 ha
					Pasture improvement	0 ha	250 ha
	Comanche	Qld	Jul 2018	Yr 5	Cultivation area	0 ha	342 ha
					Irrigated area	0 ha	225 ha
					Pasture improvement	172 ha	595 ha
	Dyamberin	NSW	Oct 2018	Yr 5	Grazing area	1,175 ha	Existing area
	Woodburn	NSW	Jan 2019	Yr 5	Grazing area	802 ha	Existing area
	Cobungra	Vic	Mar 2019	Yr 5	Grazing area	4,221 ha	Existing area
	Petro, High Hill, and Willara	WA	Feb 2020	Yr 5	Irrigated area	200 ha	Existing area
					Grazing area	5,402 ha	Existing area
	Capex							$2.5m	$4.6m	$0.0m	$4.6m
Cropping	Lynora Downs	Qld	Dec 2016		Water storage	10,405 ML	4,142 ML
					Irrigated cropping	779 ha	781 ha
	Mayneland	Qld	Sep 2018		Water storage	5,700 ML	2,900 ML
					Irrigated cropping	485 ha	246 ha
	Capex							$3.3m	$2.1m	$0.0m	$2.1m
Macadamias	Central Queensland (FY22)	Qld	Various		Orchard development	0 ha	1,000 ha
	Central Queensland (FY23-26)	Qld	Various		Orchard development	0 ha	4,000 ha
	Capex							$12.7m	$27.3m	$16.8m	$44.1m
Almonds	Various	NSW	Various		Orchard capex	$\overline{\phantom{a}}$	$\overline{\phantom{a}}$
	Capex							$1.3m	$1.0m	$0.0m	$1.0 m
	Total capex							$19.8m	$35.0m	$16.8m	$51.8m

Note:

Five-year developments refer to development potential of assets. Pasture improvement includes stylo and leucaena. Cultivation area refers to development of additional areas for forage crops. Grazing area involves improving production of an existing area. FY23f macadamia capex primarily attributable to development of "stage one" 1,000 ha. Forecast capex includes rentable and non-rentable amounts. Properties with developments plans to be finalised include: Homehill, The Pocket (Yarra) and Baamba Plains. 28

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