R.E.A. Holdings plc: Annual report in respect of 2025

R.E.A. HOLDINGS PLC (the company)

ANNUAL FINANCIAL REPORT 2025

The company's annual report for the year ended 31 December 2025 (including notice of the AGM to be held on 10 June 2026) (the annual report) will shortly be available for downloading from www.rea.co.uk/investors/financial-reports.

A copy of the notice of AGM will also be available to download from www.rea.co.uk/investors/calendar.

Upon completion of bulk printing, copies of the annual report will be despatched to persons entitled thereto and will be submitted to the National Storage Mechanism to be made available for inspection at https://data.fca.org.uk/#/nsm/nationalstoragemechanism.

The sections below entitled Chairman's statement, Dividends, Principal risks and uncertainties, Longer-term viability statement, Going concern and Directors' responsibilities have been extracted without material adjustment from the annual report. The basis of presentation of the financial information set out below is detailed in note 1 to the financial statements below.

HIGHLIGHTS

Overview

•  Successful completion of initiatives improving the group’s financial position, including CDM sale

•  Increased profitability in the core agricultural operations

Financial

•  Revenue increased 3.7 per cent to $194.9 million (2024: $187.9 million), with higher average selling prices offsetting lower CPO sales volumes

•  Average selling prices for CPO up 4.2 per cent at $853 per tonne (2024: $819 per tonne) and for CPKO up 48.9 per cent at $1,629 per tonne (2024: $1,094 per tonne)

•  EBITDA up 9.5 per cent to $67.4 million (2024: $61.6 million) reflecting higher selling prices

•  Profit before tax of $24.0 million, after net non-routine losses of $3.8 million (2024: $38.9 million, after net non-routine gains of $17.0 million)

•  Net indebtedness reduced by $7.0 million to $152.3 million at 31 December 2025 (31 December 2024: $159.3 million) with an improved maturity profile

•  Indonesian bank loans repackaged and increased, partially refinancing maturing indebtedness

•  Redemption in August 2025 of the outstanding £21.4 million nominal of sterling notes at 104 per cent

•  Redemption of not less than $17.6 million nominal of the outstanding $27.0 million dollar notes postponed from 30 June 2026 to 31 December 2028

Agricultural operations

•  FFB harvested by the continuing group (ex CDM) 620,508 tonnes (2024: 636,826 tonnes) from mature hectarage again reduced by replanting

•  CPO extraction rate maintained above 22 per cent

•  Oil losses consistently better than industry standards

Stone and sand operations

•  ATP stone moving into production and confirming contracts for some 1 million tonnes in 2026–2027

•  Sand washing plant upgraded to improve the purity and increase sales potential of the silica sand; evidence of good demand

•  Both ATP and MCU now under direct control of the group

Sustainability and climate

•  100 per cent of the group’s own plantations now RSPO certified

•  ZSL SPOTT score improved to 97.1 per cent (2024: 91.5 per cent), ranking REA second out of 100 companies assessed

•  NDPE verification assessed the group’s supply base as ‘delivering’ 100 per cent and fully compliant with NDPE commitments

•  Programmes to promote sustainable development and climate action for both the group and smallholders continuing to expand

Outlook

•  Steady increase in crops and extraction rates expected as immature areas coming into production substitute for replanted mature areas

•  Current CPO prices comfortably above 2025 average level with supply and demand balance for CPO maintaining prices at rewarding levels; effects of the Middle East conflict likely to underpin prices

•  Continuing replanting and extension planting programme improving the quality and lowering the average age of the group's estates

•  Outlook encouraging for increasing returns from the agricultural operations, augmented by contributions from stone and silica sand

CHAIRMAN'S STATEMENT

Operating profit for 2025 was 15.2 per cent higher than in the previous year at $40.3 million (2024: $35.0 million). Higher sales prices for both CPO and CPKO more than offset both the reduction in mature hectarage available for harvesting and the delays in cropping and crop ripening resulting from unseasonal climate conditions in the second half of the year.

Total revenue for the year, including sales of stone, was 3.7 per cent higher than in 2024 at $194.9 million (2024: $187.9 million). EBITDA was up 9.5 per cent at $67.4 million (2024: $61.6 million).

FFB harvested during the year totalled 620,508 tonnes (excluding CDM), 16,318 tonnes lower than in 2024 reflecting the reduction of mature plantings due to the ongoing replanting programme. Additionally, the sale in mid 2025 of the subsidiary company CDM reduced harvested crop year on year by 34,520. High rainfall during the year also resulted in lower than expected crop levels during the second half of 2025.

Mill operations continued to operate satisfactorily through the year, with oil losses again remaining better than industry standards. Extraction rates were again at respectable levels, notwithstanding the impact on fruit quality caused by adverse weather conditions. Production of CPO, CPKO and palm kernels totalled, respectively, 189,215 tonnes (2024: 190,235 tonnes), 17,461 tonnes (2024: 18,086 tonnes) and 43,798 tonnes (2024: 44,286 tonnes).

Replanting during the year continued on schedule with approximately 1,400 hectares completed, whilst extension planting at PU totalled approximately 800 hectares. Both programmes are planned to continue through 2026 and beyond, but new plantings are expected to be undertaken at a slower pace with a target programme of 700 hectares against the 1,000 hectares originally planned.

The group remains committed to ensuring that sustainability remains at the centre of all areas of activity. Following the sale of the subsidiary CDM, 100 per cent of the group’s plantations are now RSPO certified and all three mills have retained their certification. The group continues to encourage and assist smallholders in achieving RSPO certification and EU regulatory compliance. A number of new programmes were launched during the year to support independent smallholders in this endeavour, with the group providing training and facilitating the building of long-term partnerships.

The group’s status as a leading sustainable palm oil producer was reinforced by the achievement of a ZSL SPOTT score of 97.1 per cent (2024: 91.5 per cent), ranking the group second out of the 100 companies assessed.

The anticipated scaling up of the development and commercialisation of the group’s stone operation was hampered by adverse weather conditions in the first half of the year. Blasting commenced in September and the production capacity has steadily increased. Crushed stone production totalled some 187,000 tonnes during the year, of which some 104,000 tonnes were sold to third parties, the balance being utilised by the group for road hardening. Demand for stone from neighbouring coal companies remains strong but actual offtake to date has been slower than originally anticipated largely due to regulatory factors.

The upgraded sand washing plant that was installed during 2025 is now being commissioned. The enhancements to the plant are designed to improve the purity of the silica sand produced and increase its sales potential. Demand for silica sand appears to be strong and, if translated into firm orders, the sand operation will be well placed to move rapidly to large scale production.

CPO and CPKO prices, CIF Rotterdam remained consistently above $1,000 per tonne and $1,500 per tonne respectively, largely as a consequence of generally slower growth in production and increased demand. The Indonesian government’s B40 (40 per cent biofuel diesel blend) mandatory requirement, introduced in January 2025, added to this demand. The CIF Rotterdam prices currently stand at $1,555 per tonne for CPO and $2,220 per tonne for CPKO. The average selling prices for the group’s CPO and CPKO during 2025, including premia for oil with certified sustainability credentials, net of export duty and levy, adjusted to FOB Samarinda were, respectively, $853 per tonne (2024: $819 per tonne) and $1,629 per tonne (2024: $1,094 per tonne).

Profit before tax for 2025 amounted to $24.0 million compared with $38.9 million in 2024. Excluding the losses and gains on the disposal of subsidiaries and similar charges, foreign exchange movements and other non-routine items, profit before tax would have amounted to $27.8 million comfortably ahead of the $21.9 million equivalent in 2024. Cost of sales for 2025 totalled $136.5 million, unchanged from 2024, and administrative expenses were also broadly in line with those of the previous year. Losses on the disposal of subsidiaries comprised a $5.7 million loss on the sale of CDM and a $0.6 million loss on the dissolution of REAF. Other gains and losses during the year related to exchange movements on borrowings. Finance costs for 2025 amounted to $13.4 million (2024: $16.4 million), the decrease being principally a result of the lower average level of borrowings during the year.

The semi-annual dividends arising on the preference shares in June and December were paid on their due dates.

Several initiatives to improve the group’s financial position were undertaken during the year. In addition to the sale of CDM, a number of existing loan facilities provided by Bank Mandiri were repackaged and increased with extended final maturities. New loan facilities were also arranged to fund a proportion of the costs of extension planting at PU and the replanting programme at REA Kaltim.

In August 2025, the group redeemed the outstanding £21.4 million nominal of sterling loan notes. Later in the year, arrangements were agreed to extend the redemption date from June 2026 to December 2028 of not less than $17.6 million nominal of dollar loan notes.

As a result, total group net indebtedness at 31 December 2025 was $152.3 million, $7.0 million lower than at 31 December 2024 and with a more extended maturity profile. It remains the group’s intention to reduce net debt as prudently and quickly as possible. Nevertheless, debt reduction needs to be balanced with the requirements of both maintaining and enhancing operations.

As reported previously, the Indonesian government initiated a review during 2025 of regulatory compliance by the Indonesian oil palm industry. The inspection of the group’s operations, conducted as part of this review, did not identify any areas of non-compliance within the group’s own oil palm plantings. However, three small areas, owned by local cooperatives and smallholders but managed by the group, were subject to further investigation. The group does not believe that it should have any liability in relation to these areas. As far as is known, there will be no further assessments of the group pursuant to the Indonesian government’s review of regulatory compliance by oil palm companies. Nevertheless, given this highlighted focus on regulatory compliance, the group intends to proceed earlier than originally planned with the renewal of its land titles that are due to expire between 2028 and 2029. Concurrently, the group is also reviewing or formalising other key titles.

Looking ahead, harvested crops should steadily increase as immature areas coming into production begin to more than substitute for crops lost as a result of replanting. Oil extraction rates can also be expected to improve as those younger areas mature.

The increasingly tight balance between supply and demand experienced in recent months coupled with the knock on effects of rising petroleum oil prices following the conflict in the Middle East have caused CPO prices, adjusted to FOB Samarinda, to rise to above $900 per tonne and are likely to maintain CPO prices at rewarding levels for quite a while. However, this conflict is also likely to cause a significant increase in the cost of fuel and fertiliser. As a consequence, the group will adopt a prudent approach to incurring capital expenditure in 2026. As stated earlier, the extension planting programme has been scaled back by some 30 per cent and purchases of capital equipment that are not time critical will be deferred.

While the offtake of crushed stone was slower than expected during 2025, the group is confirming contracts for delivery of in excess of 1 million tonnes during 2026 and 2027 which should make a significant contribution to group revenues. This contribution should be progressively augmented by sales of silica sand for which demand appears to be strong.

With the prospect of CPO and CPKO prices remaining at current or better levels, notwithstanding probable higher fuel and fertiliser costs, and with the addition of significant contributions from stone and silica sand sales, the outlook is encouraging.

Following on from the changes to the board of directors in early 2026, three of the company’s longest serving non-executive directors, John Oakley, Michael St. Clair-George and Richard Robinow will retire at the conclusion of the annual general meeting to be held in June 2026. On behalf of the board, I would like to express our sincere appreciation and thanks to all of them.

John joined the company in 1983, was appointed managing director in 2002, and following his retirement from that position in 2016, remained on the board as a non-executive director. Michael joined the board in 2016 as a non-executive director and subsequently was appointed as the senior independent director and chairman of the audit committee.

Richard was instrumental in shaping the current REA group at the end of the 1980s, laying the foundation for the company’s first oil palm operations in 1992. An astute investor with a flair for commercial opportunity, coupled with a keen sense of responsibility, Richard has consistently driven REA’s growth and developed the operations to create an enduring legacy that will benefit generations to come. A truly outstanding accomplishment.

David J BLACKETT

Chairman

DIVIDENDS

The fixed semi-annual dividends that fell due on the preference shares in June 2025 and December 2025 were paid on their due dates. 2024 payments included arrears of dividend which amounted in aggregate to 11.5p per preference share as at 31 December 2023.

ANNUAL GENERAL MEETING

The sixty sixth annual general meeting (AGM) of R.E.A. Holdings plc to be held at the London office of Ashurst LLP at London Fruit & Wool Exchange, 1 Duval Square, London E1 6PW on 10 June 2026 at 10.00 am.

Attendance

To help manage the number of people in attendance, it is requested that only shareholders or their duly nominated proxies or corporate representatives attend the AGM in person. Anyone who is not a shareholder or a duly nominated proxy or corporate representative of a shareholder should not attend the AGM unless arrangements have been made in advance with the company secretary by emailing company.secretary@rea.co.uk.

Shareholders are strongly encouraged to submit a proxy vote on each of the resolutions in the notice in advance of the meeting:

(i)  by visiting Computershare’s electronic proxy service www.investorcentre.co.uk/eproxy (and so that the appointment is received by the service by no later than 10.00 a.m. on 8 June 2026);

(ii) via the CREST electronic proxy appointment service;

(iii)  by completing, signing and returning a form of proxy to the company’s registrar, Computershare Investor Services PLC, The Pavilions, Bridgwater Road, Bristol BS99 6ZY as soon as possible and, in any event, so as to arrive by no later than 10.00 a.m. on 8 June 2026; or

(iv)  in the case of an institutional investor, by using the Proxymity platform (for more information see Notice).

The company will publish updates, if any, about the meeting at www.rea.co.uk/investors/regulatory-news and on the website's home page. Shareholders are accordingly requested to visit the group’s website for any such updates.

The directors and the chairman of the AGM, and any person so authorised by the directors, reserve the right, as set out in article 67 in the company’s articles of association, to take such action as they think fit for securing the safety of people at the AGM and promoting the orderly conduct of business at the meeting.

PRINCIPAL RISKS AND UNCERTAINTIES

The group’s business involves risks and uncertainties. Risks and uncertainties that the directors currently consider to be material or prospectively material are described below, together with climate-related risks and the opportunities that these may provide. There are or may be further risks and uncertainties faced by the group (such as future natural disasters or acts of God) that the directors currently deem immaterial, or of which they are unaware, that may have a material adverse impact on the group.

Identification, assessment, management and mitigation of the risks associated with sustainability matters forms part of the group’s system of internal control for which the board has ultimate responsibility. The board discharges that responsibility as described in Corporate governance in the annual report. Material risks, related policies and measures taken by the group to address sustainability matters as respects the agricultural operations are described in more detail in Climate-related risks and opportunities below. This does not include information as respects the stone and sand operations due to the low level of these operations during 2025 and to date. The stone (ATP) and sand (MCU) companies became group companies in, respectively, July 2024 and August 2025 as described in the Strategic report under Stone and sand operations in the annual report. The group expects to report on these matters for both ATP and MCU from 2026 onwards.

Geopolitical uncertainty, such as may be caused by wars, can lead to pricing volatility and shortages of the necessary inputs to the group’s operations, such as fuel and fertiliser, inflating group costs and negatively impacting the group’s production volumes. The impact of input shortages, however, may be offset by a consequential benefit to prices of the group’s outputs.

Where risks are reasonably capable of mitigation, the group seeks to mitigate them. Beyond that, the directors endeavour to manage the group’s finances on a basis that leaves the group with some capacity to withstand adverse impacts from both identified and unidentified areas of risk, but such management cannot provide insurance against every possible eventuality.

Risks assessed by the directors as currently being of particular significance are those detailed below under:

•  Agricultural operations – Produce prices

•  Agricultural operations – Other operational factors

•  Stone and sand operations – Sales

•  General – Funding

The directors’ assessment, as respects the above risks, reflects both the key importance of those risks in relation to the matters considered in the Longer-term viability statement below and more generally the extent of the negative impact that could result from adverse incidence of such risks.