1 INTEGRATED ANNUAL REPORT 2026
2 INTEGRATED ANNUAL REPORT 2026
1 INTEGRATED ANNUAL REPORT 2026
2 INTEGRATED ANNUAL REPORT 2026 NCT is a timber marketing co-operative catering to the needs of private and independent timber growers. Established in 1949, NCT is recognised as an international supplier of quality hardwood pulp wood chips, round-wood timber, and is the largest forestry marketing organisation in southern Africa. OUR MISSION To assist members to achieve their full forestry potential and thereby optimise financial results on a sustainable basis. OUR STRATEGY With the strength inherent in co-operative principles, employing motivated staff and appropriate technology, our mission is achieved by: • Marketing round-wood timber • Research and development • Extension and planning services • Securing additional timber supplies • Facilitating the harvesting and transportation of timber • Managing the assets of NCT • Distributing available surpluses to members in proportion to patronage • Interacting with appropriate forestry- related stakeholders • Encouraging social responsibility and sustainable forestry stewardship • Promoting value-adding activities. OUR VISION To win and maintain the unreserved confidence and support of all our members, customers and employees.
3 INTEGRATED ANNUAL REPORT 2026 About this Report 4 Business Model 6 SDG Highlights 8 Chairman’s Report 16 General Manager’s Report 20 Governance 36 Human Resources 54 Finance 69 Contents
4 INTEGRATED ANNUAL REPORT 2026 ABOUT THIS REPORT This integrated report aims to provide an accurate and concise overview of all material matters and describe how the NCT group achieved its business goals and created value for the financial year ended 28 February 2026. The NCT group includes NCT Forestry Agricultural Co-operative Limited and its subsidiaries (please refer to our governance section). This report contains both financial and non-financial information and has been compiled by management and reviewed and approved by the Board. Materiality was determined by the impact a reporting item might have on our stakeholders. This Report was prepared in accordance with the IFRS for SME® Accounting Standards, the requirements of the Companies Act (where applicable), the Co-operatives Act, the principles of King IV and guided by the International Integrated Reporting Framework. Co-operative Reports The Board is not required to complete a social report, or a management decision report as stipulated in regulations 33 and 34 of the Co-operative Act 14 of 2005 respectively as NCT is a category C co-operative and the annual financial statements are independently audited. The Board certifies that to the best of their knowledge and belief that the social and ethical performance of NCT is in relation to its vision, mission, and goals as determined by the Board and within the scope of the NCT Constitution. The social and ethical performance is monitored by the Social and Ethics Committee. The Board further certifies that to the best of their knowledge and belief NCT has complied with all legal requirements and the NCT constitution. This integrated report contains some of the details ordinarily required by the social report and the management decision. report.
5 INTEGRATED ANNUAL REPORT 2026 Approval The Board can assure the NCT membership that NCT is a strong organisation and with the joint effort from the Board, Management and the NCT staff, will continue to achieve its business goals. The Board acknowledges its responsibility in ensuring the integrity of this Integrated Report. The Board has applied its mind to the Integrated Report and confirms that this report addresses the material issues and represents fairly the performance of the NCT Group. AV Schefermann | CHAIRMAN Assurance The Board and Management obtained internal and external assurances to test the reliability of the information reported on. The non-financial information has not been audited, but it has been presented to the Audit and Risk Committee as well as the Social and Ethics Committee. The Board is satisfied that the information contained in this report is a fair reflection of NCT’s non-financial performance. Any projections made in this report or strategic outlooks presented are made on subjective criteria and cannot be verified nor relied upon for any decision-making. The Internal Audit function tests the internal control measures put in place by Management to ensure that processes conform to NCT’s quality management systems. The internal audit report can be found on page 52. NCT is endorsed by two forestry certification standards, Forestry Stewardship Council® (FSC®) and the Programme for Endorsement of Forest Certification (PEFC) which ensures that timber is sourced from operations that comply with controlled-wood requirements. All financial information was externally audited by Colenbrander Inc. The external audit report can be found on page 64.
6 INTEGRATED ANNUAL REPORT 2026 Growing a sustainable resource with access to over 200 000ha of members’ and NCT-owned commercial plantations. NCT-owned plantations act as a reserve Improving efficiencies and investing in equipment and technologies. Three woodchipping plants, four timber depots and six member-services’ offices Sound investment Strategic Financial Management Stable working capital Hedging mechanisms Research and development Effective supply-chain management Robust information Industry response system Employing and investing in 714 diverse and professional people to reach operational goals Community support and engagement Social projects Stakeholder relationships STAKEHOLDERS – Members | Customers | Employees | Communities | Service providers | Industry bodies | B U S I N E S S INPUTS SOCIAL HUMAN INTELLECTUAL FINANCIAL MANUFACTURING NATURAL SUPPORT SERVICES CORE ACTIVITIES THE BUSINESS Logistics Tree Farming Finance Forest Technology Human Resources Wood Chipping Information and Communication technology Markets Members GOVERNANCE NCT’s CAPITALS ACTIVITIES
7 INTEGRATED ANNUAL REPORT 2026 TURNOVER Group R3.37 billion Co-operative R3.36 billion TOTAL ASSETS Group R2.82 billion Co-operative R2.27 billion LOGISTICS Road: 561 496 tonnes Rail: 62 497 tonnes Loading operations 309 070 tonnes R&D INVESTMENT R6 223 816 TRANSPORT CARBON FOOTPRINT A saving of 10 711.263 Tonnes CO2 BIODIVERSITY FOOTPRINT 20 030ha Group 7 688ha NCT only KEY OUTCOMES OUTPUTS WOOD CHIP EXPORTS 1 589 620 GMT DOMESTIC MARKET Pulpwood 363 609 tonnes Non-pulpwood 83 562 tonnes CERTIFICATION FSC 67 320 ha PEFC 18 477 ha EUDR Ready TRAINING OPPORTUNITIES Completed: 1 305 Acacia 970 772 21 886 Eucalyptus 1 259 602 18 054 TOTAL 2 229 1 374 39 943 MEMBERS Genus GST Actual supply Payment (Tonnes ‘000) (R’000) TRAINING SPEND R2 348 000 SETA REFUND R507 199 Government departments | Competitors | Media | Environmental/conservation lobby groups | General public MODEL CSR & BBBEE SPEND R3.6 million
8 INTEGRATED ANNUAL REPORT 2026 NCT : Environmental • Social • Governance 1 As part of NCT’s commitment to sustainability and continuous improvement, we have developed an internal SDG Analysis Platform to evaluate how our Annual Report aligns with the United Nations Sustainable Development Goals (SDGs). The platform analyses the content of this report, identifies sustainability-related evidence, and assesses alignment across each of the 17 SDGs. The analysis is based solely on information disclosed within this Annual Report and is intended to provide additional sustainability insights, identify strengths and opportunities, and support ongoing ESG reporting and strategic decision-making within NCT. Supporting this year’s theme of resilience, the analysis demonstrates how sustainable decision-making strengthens NCT’s environmental, social and governance performance, contributing to the long-term resilience of our organisation, members and stakeholders. Environmental, Social and Governance ESG Category Breakdown Document alignment across Environmental, Social and Governance pillars
9 INTEGRATED ANNUAL REPORT 2026 NCT : Environmental • Social • Governance 2
10 INTEGRATED ANNUAL REPORT 2026 NCT : Environmental • Social • Governance 3
11 INTEGRATED ANNUAL REPORT 2026 NCT : Environmental • Social • Governance 4 Detailed SDG Analysis Individual SDG alignment – 12 goals addressed SDG IMPACT ASSESSMENT • ANNUAL REPORT MAIN NARRATIVE SDG FINAL
12 INTEGRATED ANNUAL REPORT 2026 N CNTC:TE:nEvni rvoi rnomnemnet na lt a•l •S oScoi acli a•l •G oGvoevr ne rannacne c e5 5
13 INTEGRATED ANNUAL REPORT 2026 NCT : Environmental • Social • Governance 6
14 INTEGRATED ANNUAL REPORT 2026 NCT : Environmental • Social • Governance 7
15 INTEGRATED ANNUAL REPORT 2026 NCT : Environmental • Social • Governance 8
16 INTEGRATED ANNUAL REPORT 2026 a challenging global market cycle. The Co-operative’s reputation for reliability, quality and ethical trade continues to serve it well, reinforcing our standing as a trusted supplier in both export and domestic markets. These strengths are not accidental; they are the product of long-term relationships, consistent performance and a willingness to align to evolving market expectations. It is no coincidence that our trading relationship with Japan now extends beyond 50 years. On the back of these positives, the Co-operative sold just under 2 million tonnes of member timber, of which 80% was chipped and exported. With trading volumes returning to pre-fire levels, the Co-operative marked a turnover of R3.4 billion, but on the back of difficult trading conditions and a strengthening Rand, the Group returned a loss of R43.7 million. The strengthening rand and subdued dollar prices created enough pressure on cash flows to require the Co-operative to reduce timber prices to members during the period, after holding off as long as possible using built-up reserves. These decisions are Chairman’s Report 2026 The year under review marks an important chapter in NCT’s journey of renewal and progress. While the operating environment remained demanding, it was also a period in which the Co-operative demonstrated its capacity to adapt, recover and position itself for sustainable success. The steady restoration of the Richards Bay Mill Complex stands as a clear illustration of what can be achieved through disciplined planning, technical expertise and determination. As capacity returned and resilience improved, the organisation regained operational flexibility and strengthened its ability to support members and serve markets with confidence. This recovery has laid a stronger foundation for the years ahead. The year was not without its challenges, and being an export-dominated business, the strengthening of the rand in the second half of the period placed revenue lines under significant pressure. Encouragingly, demand for NCT’s preferred species remained robust and customer relationships continue to endure through VERN SCHEFERMANN
17 INTEGRATED ANNUAL REPORT 2026 never taken lightly and ultimately do protect the longterm viability of the organisation. Given these challenging trading conditions, added to the Middle East conflict driving up local fuel prices, the Board has seen fit to initiate an independent in-depth look at the Co-operative’s own internal efficiencies and our value chain; from member and own farms right through to vessel loading and our various markets through an external consultancy. The outbreak of conflict in the Middle East, and ensuing oil crisis deepens the challenges faced by South African timber farmers, making the assessment of our own operations even more crucial, and the outcomes stand us in good stead as the Co-operative adjusts its strategic planning to ensure long-term sustainability of our members and our organisation. However, the Board is particularly encouraged by the progress made in positioning NCT for a more regulated and sustainability focused future. Advances in certification uptake, supply chain visibility and digital systems represent meaningful investments in the Cooperative’s long-term relevance and competitiveness. While these changes require adjustment, they also create opportunity, providing clarity, transparency and resilience in an increasingly complex operating landscape. Strong governance and fairness remain central to the Co-operative’s ethos. Throughout the year, the Board and management remained committed to principled decision making, transparent engagement with members, and safeguarding the integrity of the organisation. These foundations enable NCT to navigate change with confidence and to balance immediate pressures with long-term value creation. As we look ahead, the Co-operative enters the new financial year stronger, more capable and better prepared. While uncertainties remain, particularly in global markets, the direction is clear. NCT is well positioned to build on its strengths, continue supporting its members, and pursue sustainable growth in a changing industry. During the period under review, there were changes to the Board, with Andy Mason taking on the reins as Vice Chairman, and Heiner Hinze accepting a nomination onto the Board. On behalf of the Board, I extend my sincere appreciation to our members, employees and management team for their commitment and resilience. The year reinforces our belief that, by working collectively and with purpose, NCT can continue to thrive and deliver enduring value for present and future generations. AV SCHEFERMANN | CHAIRMAN
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20 INTEGRATED ANNUAL REPORT 2026 This Operating and Strategic Review provides an account of NCT’s related key events, operational developments, market dynamics and strategic decisions taken during the financial year. The narrative is substantiated by the ongoing series of member briefs and operational communications issued throughout the year to members and suppliers, and reflects how strategic intent was, and continues to be translated into practical execution. Sustainable Development Goals (SDG) Alignment Statement The activities, outcomes and strategic responses described in this Operating and Strategic Review contribute directly to the achievement of the United Nations Sustainable Development Goals (SDGs). In particular, NCT’s operations during the financial year are aligned to areas of SDG compliance, illustrated by appropriate icons which are shown below: General Manager’s Report DANNY KNOESEN Operating and Strategic Review
21 INTEGRATED ANNUAL REPORT 2026 SDG 2 (Zero Hunger), SDG 3 (Good Health and Well-being), SDG 4 (Quality Education), SDG 7 (Affordable and Clean Energy), SDG 8 (Decent Work and Economic Growth), SDG 9 (Industry, Innovation and Infrastructure), SDG 10 (Reduced Inequalities), SDG 12 (Responsible Consumption and Production), SDG 13 (Climate Action), SDG 15 (Life on Land), SDG 16 (Peace, Justice and Strong Institutions) and SDG 17 (Partnerships for the Goals). Market Review For the period under review, the international Asian woodchip market maintained a subdued tone, with market sentiment weighed down by macroeconomic pressures and shifting fibre dynamics. The reintroduction and escalation of U.S. trade tariffs under the Trump administration added further strain to the Chinese economy, dampening manufacturing output and paper demand, and in turn softening appetite for imported hardwood chips. This was compounded by China’s struggling property sector, which generated increased volumes of domestic wood residues; these surplus chips displaced a portion of import demand and reinforced buyers’ already cautious stance. Dollar-denominated prices reflected this softness, trending lower through much of the year and remaining under pressure as Chinese buyers leveraged both weak demand conditions and ample local supply in price negotiations. At the same time, Japan’s structural decline in paper consumption continued as expected, steadily eroding one of the market’s historically stable demand anchors. Against this backdrop of weakening demand in both major markets, competition among exporters intensified. Australian suppliers responded aggressively by lowering offer prices to regain competitiveness into China and Japan, effectively resetting the marginal price level in the market. Southeast Asian producers retained advantages in freight and proximity, but their pricing power was similarly constrained. South African exporters faced a more competitive landscape as a result, with improved logistics offset by limited ability to command premium pricing. Overall, the year under review was characterised by a buyer-driven market, persistent oversupply pressures, and a more defensive posture across the global supplier base. This resulted in hardwood volumes dropping year on year by 7%.
22 INTEGRATED ANNUAL REPORT 2026 Against this backdrop, NCT performed exceptionally well in the markets, with our key customers all taking maximum volumes from us, and our second stalwart Chinese customer returning to contract post-fire. This positioned South Africa as an exception against other major suppliers, and our year-on-year volumes returned to pre-fire levels. Although dollar pricing remained lower than ideal, having four major customers on contract meant that overall, NCT was able to take in all the timber required by members. Our volumes into Japan have not eroded at all, and our Chinese relationships continue to gain strength. Domestic market volumes also largely met expectations, and this positioned NCT to report 1.99 million tonnes of members’ timber being sold. Export volumes grew substantially year-on-year, as NCT reached a point of 100% recovery after the great fire of 2023 and the port loader issues, both of which suppressed NCT’s ability to export in the previous financial year, with 1.59 million tonnes exported (FY2025 667 965 tonnes), at a ratio of 69% to 31% between Japan and China respectively. Looking ahead, dollar prices remain challenging, and no further increases have been realised going into 2026, despite protracted negotiations. This being on top of the tumultuous conditions faced by our clients, who themselves face herculean exchange rates, shortages of much needed chemicals out of the Middle East, and tepid pulp and paper markets. Despite global uncertainty, NCT enters 2026 from a position of some strength. Our order book shows Acacia and Eucalyptus volumes are largely committed, and without this platform, it would be extremely difficult to navigate through the minefields of the current international trading conditions and the Iran conflict which has single handedly raised fuel prices by as much as 30% locally. Global seaborne woodchip supply to Pacific regions update volume Unit: Thousand BDMT Hardwood Chips 2025 2024 % Change Vietnam 16 875 17 913 -6% Australia 3 687 3 539 4% Thailand 2 169 2 619 -17% South Africa 1 467 1 019 44% Chile 1 101 1 271 -13% Indonesia 593 980 -39% Brazil 304 531 -43% New Zealand 171 164 4% Malaysia 130 348 -63% Uruguay 33 69 -52% United States 18 39 -53% Cambodia 18 - World Total 26 566 28 491 -7%
23 INTEGRATED ANNUAL REPORT 2026 Start of the Financial Year: Recovery, Stability and Controlled Intake The financial year commenced with NCT firmly focused on stabilising operations following the devastating Richards Bay Mill Complex fire (occurring in the previous year) and the ongoing phased reconstruction programme. Engineering works, including gantry and conveyor installations, continued to impose constraints on pulpwood intake, storage and chip processing. As a result, member and supplier timber intake at NCT Richards Bay Mill Complex was deliberately moderated during certain months to maintain safe and efficient operations, whilst avoiding unnecessary disruption to market commitments and affording members the semblance of rateable mill access during very dynamic circumstances. NCT Durban Wood Chips operations were managed with particular care amid some ad-hoc shipping schedule volatility. Despite this, and aside from a limited amount of full-stock, situational stoppages, the mill performed strongly, delivering outstanding production and export volumes over the period. Joint Acacia and Eucalyptus smithii consignments once again played a key role in smoothing monthly supply, helping to mitigate the impact of irregular vessel availability and reducing the risk of extended downtime. This approach ensured a high level of operational continuity, reinforced client confidence in NCT’s reliability, and supported consistent revenue flow through what remained a challenging logistical environment.
24 INTEGRATED ANNUAL REPORT 2026 Certification Focus and Reinforcement of Ethical Supply Certification pressures from both export and domestic markets intensified during the early part of the year. The spoken demand for FSC-certified timber started to increase significantly and widespread client calls for a supplier EUDR compliance declaration became the order of the day. In response, NCT initiated a concerted FSC certification drive aimed at progressing towards a medium-term target of 70% FSC-certified intake, with an earlier interim milestone of 50%. Allocation preference for certified suppliers, particularly Acacia growers, was introduced to operationalise and attain this objective. Focus on methods to meet the stringent EUDR source to market visibility requirement served again to highlight deliverynote misuse and chain-of-custody breaches as potentially material risks. NCT’s enhanced scrutiny across the supply chain, investigation of incidents and decisive disciplinary action reinforced the Co-operative’s zero-tolerance stance on unethical supply, thereby protecting market access and organisational reputation, and bringing us ever closer to unequivocally announcing EUDR compliance. Mid-Year: Governance Discipline and Digital Enablement As the year progressed, governance discipline became increasingly important in an increasingly constrained and compliance-driven environment. Management regularly reinforced VAT compliance, accurate supplier categorisation and adherence to the NCT Code of Conduct and final and revised Guaranteed Supply Tonnage (GST) limits as necessary safeguards for Co-operative sustainability. A significant milestone was the rollout of the NCT member App and cloud-based website, enabling electronic GST submissions, improved allocation visibility and the foundation for geo-referenced source verification. These systems materially improved transparency, operational visibility and compliance readiness.
25 INTEGRATED ANNUAL REPORT 2026 Second Half of the Year: Capacity Restoration and Strategic Readiness The second half of the year marked a turning point as major engineering infrastructure at the NCT Richards Bay Mill Complex was progressively recommissioned. This significantly improved operational flexibility, stock management and turnaround efficiency. In parallel, certification capacity was strengthened through the tactical approach of the NCT specialist Certification team further positioning NCT to meet FSC, EUDR and Sustainable Biomass Programme requirements and reinforcing readiness for future market expectations. The NCT Code of Conduct signed annually by all participating members and suppliers really proved its worth during the year and endorsed the fact that all suppliers own and are responsible and accountable for their individual chains of supply. Member Engagement, Risk Management and Allocation Fairness Member engagement remained central via regular member briefs, the NCT App and website, zone meetings, webinars, field days and the Annual General Meeting, thereby ensuring transparency and shared understanding during a challenging year. Allocation processes were aligned to revised GST commitments, with strict application of the 110% cap in the interests of fairness to all. External logistics and infrastructure risks further underscored the importance of disciplined planning and ethical supply practices.
26 INTEGRATED ANNUAL REPORT 2026 OPERATIONAL PERFORMANCE, EXPORT THROUGHPUT AND LOGISTICS ENABLEMENT During the latter part of the financial year, operational recovery translated into measurable throughput gains across wood chipping and logistics activities. NCT Durban Wood Chips, NCT Richards Bay Wood Chips (RBWC) and NCT Logistics collectively supported export continuity, strengthened supply chain resilience and advanced infrastructure modernisation.
27 INTEGRATED ANNUAL REPORT 2026 NCT Durban Wood Chips At NCT Durban Wood Chips, stable intake and export execution supported continued service to the Japanese market. The supply received from members, NCT Tree Farming and external suppliers amounted to 594 397 tonnes exported across 13 shipments. This performance was underpinned by focused equipment upgrades aimed at fire resilience, plant reliability and maintenance discipline. Key upgrades included installation of the C8 export fire-retardant belt with new steel rollers, implementation of the Pragma key maintenance package, completion of reroofing and ventilation louvre improvements, earthing and lighting upgrades for the mill, commissioning of a portable fire pump enabling direct harbour water use during emergencies, enhancement of the deluge system on the accepts wood chip belt, and commissioning of additional fire equipment including oscillating nozzles. Collectively, these investments materially improved safety, infrastructure resilience and operational reliability. Timber intake – tonnes Exported – tonnes Acacia E. Smithii Acacia E. Smithii
28 INTEGRATED ANNUAL REPORT 2026 NCT Richards Bay Wood Chips At NCT Richards Bay Wood Chips, throughput recovery gathered momentum as intake reached 967 264 tonnes across Acacia, Eucalyptus, E. smithii and biomass categories. The supply received from members, NCT Tree Farming and external suppliers amounted to 997 132 tonnes exported across 22 shipments. Biomass exports continue to form part of the year’s activity emphatically supporting product diversification and biomass value-chain participation. Operational improvements at Richards Bay included the complete rebuilding of production conveyor systems for both BayFibre and RBWC, installation of fire-retardant rated conveyors throughout the production plants, PLC and MCC upgrades, a BayFibre screen upgrade, and fire reticulation improvements. These projects strengthened processing stability, reduced operational risk and enhanced preparedness for sustained future throughput. Timber intake – tonnes Acacia E. Smithii Biofuel Exported – tonnes Acacia E. Smithii Biofuel
29 INTEGRATED ANNUAL REPORT 2026 NCT Logistics NCT Logistics continued to play a strategic role in bringing the point of sale closer to the farm while securing competitive transport rates, sufficient freight capacity and reduced delivery risk for growers. During the year, 561 496 tonnes were transported by road through the NCT job code and tariffing system, with a further 62 497 tonnes moved by rail. PBS vehicle usage accounted for 248 337 tonnes, while loading operations reached a record 309 070 tonnes. In total, 789 growers utilised NCT’s logistics services across brokered road transport, loading operations, rail and depot services. Further logistics improvements focused on transport cost optimisation through increased use of rail and PBS combinations, consolidated loading supported by route optimisation, and improved load scheduling through a shared automated platform that enhanced visibility, control and daily monitoring across the supply chain. Depot operations were strengthened by the opening of the Umlaas Road Depot to support suppliers and provide buffer stock capability for both NCT Durban Wood Chips and Sappi Saiccor. These measures improved cost efficiency, strengthened access to appropriate technology, supported stock discipline and contributed to carbon reduction through fewer road trips and greater use of rail-linked solutions. Carbon footprint scorecard brokered volume: March 2025 – February 2026 To calculate the carbon emisions, the activity-based approach will be followed shown below as: Source: CO 2 = tonnes transported X average distance travelled x CO 2 emissions factor per tonne – km / 1 000 000 (McKinnon et al., 2015)
30 INTEGRATED ANNUAL REPORT 2026 NCT Tree Farming NCT Tree Farming remained a strategic timber reserve during the year, underpinning reliable supply, especially of E. smithii, while also strengthening FSC-certified availability, supporting field trials and providing management services. The Group owns approximately 17 438 hectares of plantations and manages a further 4 348 hectares, giving a combined footprint of 21 786 hectares. During the year, Tree Farming delivered approximately 149 391 tonnes of E. smithii , 75 126 tonnes of Acacia and 87 305 tonnes of mixed Eucalyptus, thereby helping to maintain continuity of supply into key markets. 14 189 tonnes of Acacia bark was also supplied. While mixed Eucalyptus sales remained constrained and over-aged Eucalyptus inventories remained a challenge, particularly in the northern areas, alternative market opportunities continue to be pursued. Tree Farming made a significant contribution to the Co-operative’s FSC programme, accounting for approximately 33% of total FSC-certified supply. All NCT-owned farms remain certified and about 90% of managed farms also hold certification. Biodiversity stewardship was further strengthened through the formalisation of the Sphikeni and Dambakazi Nature Reserves, which will enhance protected areas and high conservation value sites under FSC. At the same time, land claims, labour tenant matters and mining and prospecting applications continued to present material legal and financial risks requiring ongoing management attention. STRATEGIC TIMBER SECURITY VIA NCT TREE FARMING, BIODIVERSITY STEWARDSHIP AND RESEARCH CAPACITY By year-end, the contribution of NCT Tree Farming and NCT Research and Development had become increasingly important to long-term supply security, certification strength, biodiversity stewardship and climate resilience. Together, these functions reinforced NCT’s ability to support members, sustain preferred species supply and invest in future productivity through strategic land management, applied research and collaborative innovation.
31 INTEGRATED ANNUAL REPORT 2026 Research and Development Research and Development remained central to future competitiveness, species improvement and climate resilience. Total investment for the year amounted to R6 664 013, comprising direct NCT funding, industry-administered research contributions and student project support. This funding supported Acacia and Eucalyptus improvement, forest protection, pest and disease monitoring, soil and species research, and collaborative projects with industry and academic partners. Eleven trials were established during the year, covering frost-tolerant Acacia, rust tolerance, cold-tolerant Eucalyptus and subtropical Eucalyptus material, while new hybrid selections and clone evaluations continued to expand the pipeline of improved planting material. Notable progress included the continued development of improved E. smithii, E. grandis x E. smithii and E. grandis x E. nitens material, targeted work on frost-prone Acacia areas, and pest and disease screening in partnership with specialist institutions. Two new E. grandis x E. nitens clones, GN325 and GN347, were released for commercial production in December 2025, offering improved tolerance to current pests and pathogens and reducing reliance on chemical intervention. Collaboration with ICFR, TPCP, Sappi, Merensky, FABI and higher-learning institutions continued to extend research reach, improve seed security and support field-level advisory and diagnostic capacity for members. This work remains directly supportive of productivity, environmental stewardship and long-term adaptation to changing growing conditions.
32 INTEGRATED ANNUAL REPORT 2026 Community Investment and Digital Enablement Toward year-end, NCT’s contribution extended beyond operations into targeted community investment and digital capability strengthening. These areas supported rural resilience, education, environmental stewardship, traceability, EUDR compliance readiness and internal efficiency, further broadening the Co-operative’s impact across its operating landscape. Corporate Social Investment Corporate Social Investment (CSI) remained focused on practical community upliftment, with a combined investment of R2.48 million during the year. This comprised R777 492 in core CSI expenditure and a further R1.71 million invested directly through NCT’s community development programmes across its farming operations. Programmes spanned food security, education, early childhood development, child welfare, skills development, environmental support and community partnerships, reaching pre-school children, learners, vulnerable households and community organisations. In addition to partnerships with non-governmental and community-based organisations, NCT’s direct community development initiatives supported a wide range of rural development projects. These included water security and borehole projects, community and school food gardens, school infrastructure improvements, fencing and community facilities, fire awareness programmes, sports development, road maintenance, firewood assistance, skills development and learnership opportunities, as well as support for vulnerable community members and households. This investment strengthened rural resilience, improved access to education and essential services, enhanced food security, created skills development opportunities, and contributed to the social and economic wellbeing of communities within NCT’s operational areas. Supported initiatives included school feeding schemes, community food gardens, school and special-needs support, children’s homes, foster care infrastructure, agricultural training, conservation assistance, and a broad range of community development projects implemented directly by NCT. Through these combined efforts, NCT continued to reinforce its commitment to sustainable rural development and its community-centred approach to doing business.
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34 INTEGRATED ANNUAL REPORT 2026 Information and Communication Technology Information and Communication Technology continued to strengthen the operational backbone of the Co-operative during the year. Building on from prior digital foundations, NCT advanced traceability, operational visibility and compliance readiness through improved member information systems, spatially linked source verification and stronger chain-of-custody support aligned to EUDR requirements. Internal systems were also enhanced to improve stability, connectivity resilience and responsiveness as operational demands increased. A full redevelopment of the Plantation Information Management System (PIMS) is underway and is expected to support both Tree Farming operations and the broader member base. Cybersecurity remained a key focus through stronger protections, improved access controls and staff awareness initiatives, while future developments include Track and Deliver capability, deeper spatial integration and selective exploration of artificial intelligence for pest and disease monitoring. Year-end Position and Forward Outlook The financial year concluded with NCT arguably in a materially stronger and more resilient position to deal with everchanging market demands and changes. Operational capacity at mills was largely restored, digital systems embedded and certification readiness significantly enhanced. While mixed Eucalyptus markets remained constrained, early signals of gradual improvement emerged. Strong Acacia demand, improved system visibility and disciplined governance provide a solid foundation for the Co-operative as it enters the new financial year.
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36 INTEGRATED ANNUAL REPORT 2026 Good governance has been the backbone of NCT to ensure the Board leads ethically and give assurance to the NCT membership of good performance, legitimacy, and effective control. The Board follows the Principles of Good Governance for Co-operatives and King IV in its development of good governance policies and practices. During the year NCT codified the NCT values through the NCT Ethics Policy and Code of Conduct. We believe this will give further guidance to NCT’s stakeholders and more specifically our employees on how to manage business relationships and activities with all stakeholders. NCT has been a major partner of timber growers and ENABLED forestry business in South Africa since 1949. This has become the foundation of our value system. Governance
37 INTEGRATED ANNUAL REPORT 2026 LINKING OUR MEMBERS TO MARKETS Ethical Culture We champion a culture rooted in honesty, integrity, fairness, respect, and trust. These universal principles are non-negotiable – they define who we are and how we engage with the world. NCT Member-Business-centric Our members are at the heart of our mission. We strive to balance their immediate needs with the long-term sustainability of NCT, ensuring shared prosperity, tenacity, and resilience. Building Co-operation Co-operation is our strength. It stretches beyond mere practice – it’s the cornerstone of our culture. We believe in collaboration for the collective good, where no individual stands above the whole. All about People All stakeholders matter. We value mutual respect and are intentional about meaningful relationships that go beyond roles and titles. Land Stewardship Our environment is the source of our value creation. We act as responsible custodians of natural resources, ensuring that our operations protect and preserve the land for future generations. Economic Value with Purpose We are all custodians of NCT’s financial resources entrusted to create economic value with care and with purpose to promote the unique interests of our stakeholders. Duty of Responsibility Responsibility is a privilege. When entrusted with it, we embrace it with pride, knowing that others depend on us. Accountability and reliability are the hallmarks of our leadership.
38 INTEGRATED ANNUAL REPORT 2026 The NCT business model, objectives, and strategies are developed in line with policies and practices that reflect our values. Despite the many challenges experienced this year it is thanks to Good Governance that NCT once again achieved its business objectives by linking members to markets. The 76 th Annual General Meeting took place on 30 July 2025. The meeting focused on the aftermath of the fire and the recovery initiatives taken in the year 2024/2025. All decisions taken at the 2025 AGM were implemented during the reporting period. NCT is governed by a Board of Directors. Board members are elected at the AGM, and the Board may further appoint Board members as may be needed. At the end of the reporting period the NCT Board comprised of 11 non-executive directors, of which one was independent with no direct commercial interests in forestry. Messrs Day and Gibbs retired at the 2025 AGM. Messrs Payn, Stegen and Mason were re-elected and Messrs Seele and Hinze joined the Board as elected directors. Ms Motloli and Mr Bhengu were re-appointed as Board members. Mr Schefermann was re-appointed as Chairman and Mr Mason was appointed as the Vice Chairman. The Board promotes good governance through independent decision making. This is monitored through the declaration of interest register which was kept during the reporting period and regularly reviewed. This has been enhanced further with detailed background reviews of Board members and a more detailed policy on managing conflicts of interest as set out in the newly formulated NCT Ethics Policy and Code of Conduct. The Board delegates the executive functions to the General Manager who is responsible for the appointment of a specialist management team. The governance framework is maintained by the Secretary who acts as an advisor to both the Board and Management. The Board members serve on several committees and the NCT subsidiaries during their respective terms of office. Members of management also serve within this structure to report on performance, propose strategy, and execute decisions. The following committees were in place during the reporting period: Statutory Committees Audit and Risk To oversee the audit function and review risk matters Social and Ethics To oversee all matters affecting NCT stakeholders Non-statutory Committees Executive To consider market related matters and other executive decisions Tree Farms To oversee the Tree Farming division and management projects Structure To oversee group structure matters Mills To oversee the Chip Mills division
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40 INTEGRATED ANNUAL REPORT 2026 NCT Chipping Operations Rob Thompson Member Services / Assistant General Manager James van Zyl Commercial Services Kerry Moffett Financial Services (CFO) Jean Simpson Corporate Services Deepak Mohanlal IT Services Vusi Dladla Research and Development Services SENIOR MANAGEMENT Danny Knoesen General Manager BOARD of DIRECTORS Vern Schefermann – Chairman Andrew Mason – Vice-chairperson Colin Hohls Thuli Motloli Harald Niebuhr Guy Payn James Stegen Brian Bhengu Julia Rees Ben Seele Heiner Hinze Richard Liversage Tree Farming Durban Wood Chips Lenny Naidoo (Mill Manager) Derek Rall (Plant Engineer) Richards Bay Wood Chips Ryno Martyn (Mill Manager) Charles Atkins (Plant Engineer) Yolisa Mfabe Internal Auditor Leadership Structure 2026
41 INTEGRATED ANNUAL REPORT 2026 Thuli Motloli LLB; LLM (Banking Law) Colin Hohls Diploma in Agriculture Brian Bhengu Heiner Hinze BCom (Accounting); MBA Andrew Mason Diploma in Forestry Guy Payn BAgric Agricultural Management Julia Rees BSc (Hons) Environmental Microbiology Vern Schefermann BCom (Hons) Agricultural Economics James Stegen BAccSC, MBA Ben Seele BCom PGDip (Mechanical Wood Processing) Harald Niebuhr BCom (Agricultural Economics) Board of Directors
42 INTEGRATED ANNUAL REPORT 2026 Ryno Martyn Diploma in Forestry Charles Atkins N2 Derek Rall National Diploma in Mechanical Engineering Lenny Naidoo Diploma in Accounting, MBA Internal Auditor Deepak Mohanlal BCom (Hon) Jean Simpson LLB, LLM (Mercantile Law), CHC, FGC Richard Liversage James van Zyl BSc Forestry (Forest Engineering); M. CILTSA M. Phil Transport and Logistics Rob Thompson BSc (Hon) Forest Science and Conservation; Management Development Programme Kerry Moffett BCom (Hon), CA(SA), HDip (Tax) Vusi Dladla BAgric PGDip (Applied Social Science), MBA Danny Knoesen BSc Eng (Mech) Yolisa Mfabe Bcom(Accounting), PG Dip (Internal Audit), PG Dip (Forensic Audit) Management
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44 INTEGRATED ANNUAL REPORT 2026 Board Attendance To ensure proper oversight, the Board meets regularly to review the effective management of NCT. The Senior Management team prepares reporting within their respective areas of responsibility and proposes strategy and policy for consideration and approval by the Board. During the reporting period 7 board meetings were held and have been well attended by the Board. Board Meetings 23/04/2025 25/06/2025 29/07/2025 30/07/2025 10/09/2025 19/11/2025 25/02/2026 BS Bhengu Yes No Yes Yes Yes Yes Yes PBB Day Yes Yes Yes RETIRED N/A N/A N/A APG Gibbs Yes No Yes RETIRED N/A N/A N/A C Hohls Yes Yes Yes Yes Yes Yes Yes AE Mason Yes Yes Yes Yes Yes Yes Yes NC Motloli Yes Yes Yes Yes Yes Yes Yes HG Niebuhr Yes Yes Yes Yes Yes Yes Yes H Hinze n/a n/a n/a Yes Yes Yes Yes G Payn Yes No Yes Yes Yes Yes Yes JJ Rees Yes Yes Yes Yes Yes Yes Yes AV Schefermann Yes Yes Yes Yes Yes Yes Yes BA Seele Yes Yes Yes No Yes Yes Yes JW Stegen Yes Yes Yes Yes Yes Yes Yes In the development of policy and good governance practices the Board endeavours to apply the King IV code on Corporate Governance where possible.
45 INTEGRATED ANNUAL REPORT 2026 Secretary’s Declaration I hereby confirm that, in my opinion as Secretary, the Co-operative has filed all returns required in terms of the Cooperatives Act to the Registrar, and that all such returns are, to the best of my knowledge true, correct and up to date. I further confirm that all annual returns were filed for each of the subsidiary companies as required by the Companies Act. LJ SIMPSON | SECRETARY
46 INTEGRATED ANNUAL REPORT 2026 Social and Ethics Committee The Social and Ethics Committee oversees the activities of the entire NCT Group in compliance with the provisions of the Companies Act no 71 of 2008 and to oversee matters provided for in the Co-operatives Act no 14 of 2005. The committee was established in 2017 and has been overseeing activities which adds value to all NCT stakeholders and promote overall sustainability. This report contains the NCT Group activities for the year ending 28 February 2026. Role of the Committee The Committee has an independent role with accountability to the NCT Board and does not assume the functions of management. It generally oversees matters related to Social and Economic Development, Corporate Citizenship, Environmental Affairs, Health and Safety, Consumer and Public Relations, Employment Practices, and Ethics Governance. Membership The Committee is made up of four non-executive directors and five members of the executive management team. Each member of management plays a significant role in overseeing matters within the scope of the Committee’s mandate and is assisted by support staff throughout the year. The Committee members at the end of the reporting period included: Directors Management NC Motloli (Chairperson) D Knoesen BS Bhengu LJ Simpson AE Mason VC Dladla JJ Rees R Liversage R C Thompson By Invitation N Reyneke M Ngcobo M Bepat Committee Activities The Committee had oversight over the matters listed below. The details on some of these activities are found elsewhere in this report. • BBBEE Compliance and Audits • Tree Farming Community Projects (see page 32 for details) • General Community projects (see page 32 for details) • Research and Development with special focus on the GxS clone development • FSC and PEFC audit feedback and oversight of remedial actions taken • Oversight of EUDR development • Chain of Custody Matters
47 INTEGRATED ANNUAL REPORT 2026 Assurance The Committee submits this report as a fair representation of the NCT group activities for the year ending 28 February 2026. The integrated report sets out some of the activities which falls under the committee’s mandate to review. I am satisfied that NCT is complying with its social and ethical responsibilities and substantially complies with the monitoring elements provided for in the Companies Act and The Co-operatives Act. I am pleased to report that NCT has substantially complied with the seven Co-operative Principles NC MOTLOLI | CHAIRPERSON – SOCIAL AND ETHICS The Committee shall remain committed to its mandate and improve on business practices to the benefit of all stakeholders. • Voluntary and Open Membership • Democratic Member Control • Member Economic Participation • Autonomy and Independence • Education, Training, and Information • Cooperation among Co-operatives • Concern for Community 18/06/2025 09/09/2025 18/11/2025 24/02/2026 BS Bhengu Yes Yes Yes Yes APG Gibbs Yes N/A N/A N/A AE Mason Yes No Yes Yes NC Motloli Yes Yes Yes Yes JJ Rees N/A Yes Yes Yes The Board Committee met as follows: • Reviewing sustainability data in line with the United Nations 17 SDG Elements • Health and Safety Management and incident monitoring • NCT Publications • Performance of the Employment Equity Committee and the development of the 5-year plan • NCT Staff engagement survey results • Staff and third-party student initiatives • Approval of the Ethics Policy and Code of Conduct • Approval of a consolidated Training Policy
48 INTEGRATED ANNUAL REPORT 2026 Audit and Risk Committee The Co-operatives Act does not prescribe the appointment of an audit and risk committee, however NCT has appointed such committee for several years. The committee oversees all matters within its mandate for the entire NCT group and as such operates as a statutory committee for all subsidiary companies as required by the Companies Act. Role of the Committee The Committee acts within the scope of the Board approved terms of reference. The Committee is mandated to provide the Board, and in turn the NCT membership, with assurance on the external and internal audits, review of the annual financial statements and to ensure there are controls in place through risk mitigation, legal compliance and reporting mechanisms. Membership The Committee comprised six members of the Board with certain members of management have a standing invitation to attend meetings. The Committee obtains assurance and advice from the external and internal auditors. Committee Activities In addition to receiving and considering management reports the committee also attended to the following during the reporting period: • Review of external audit performance and approval of audit fees • Approval of group annual financial statements and annual report for 2025 • Review of internal audit reports and findings • Review of the risk register • Review of legal and credit risks Directors Management External Parties JW Stegen (Chairman) D Knoesen MP Black (External Auditor) C Hohls KL Moffett Y Mfabe (Internal Auditor) AE Mason LJ Simpson HG Niebuhr N Naidoo G Payn RT Liversage RC Thompson Audit and Risk Committee Membership
49 INTEGRATED ANNUAL REPORT 2026 The Committee met as follows: 18/06/2025 09/09/2025 18/11/2025 24/02/2026 APG Gibbs Yes N/A N/A N/A C Hohls C Yes Yes Yes Yes HG Niebuhr Yes Yes Yes Yes AE Mason N/A Yes Yes Yes G Payn Yes Yes Yes Yes JW Stegen Yes Yes Yes Yes Risk Management Management is mandated by the Board to determine the major risks and to develop and implement the necessary controls and mitigation measures. The risk register is reviewed regularly at committee meetings and management meetings. Major risks identified are those that have the capacity to seriously disable the normal and efficient functioning of NCT. • Review of the solvency and liquidity of the NCT group • Review of the loan covenants to ensure NCT remains within the parameters required by the bank • Approval of the SARS Authorised Economic Operator Programme • Review of the insurance portfolio • The decline of rail service and ironically the dire condition of roads may ultimately severely hamper access to mills should the declination continue along the same trajectory. • The lack of legally compliant contractors across NCT’s operational area holds the potential of impacting negatively on the further sustenance and increase of FSC certified area. • On the marketing front, NCT’s reliance on the Rand / US Dollar exchange rate is proving to be highly tenuous given the persistent exchange rate volatility in turn due to volatile global events. • The reduction in mixed Eucalyptus markets is becoming ever more a concern with old age Eucalyptus (>10 years old) occurring on farms throughout NCT’s area of operation. Alternative markets will have to be found as a priority. Those risks which cannot be avoided or mitigated through management controls are covered by an array of insurance products.
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