Managing Director’s Address Dear Fellow Shareholders, FY2026 was a defining year for EQ Resources – and, I will say plainly, a difficult one. We began the financial year confronting acute liquidity and solvency challenges that threatened the very continuity of the business. We end it recapitalised, profitable, cash generative and with the strongest balance sheet in the Company’s history. Having stepped into the Managing Director role on 1 October 2025, in the midst of that most challenging period, I am proud of what our people achieved in the twelve months to 30 June 2026 – and clear-eyed about what we must do better. Restoring the balance sheet The first half of the year was dominated by the recapitalisation of the Company. Through a series of placements, we raised A$56.5 million in new equity to settle outstanding creditors, reduce debt and restore working capital, and settled a further A$25.8 million of debt through the issue of shares. We received A$23.5 million from the exercise of options associated with FY2025 raisings, and we refinanced €15 million of external debt in Spain with Traxys Europe S.A. over a three-year term at EURIBOR plus a margin of 5.5%. The results of that work are evident throughout this report. The Company recorded a statutory net profit after tax of A$7.1 million (FY2025: loss of A$39.2 million) and EBITDA of A$50.6 million (FY2025: negative A$29.7 million). At 30 June 2026 we held A$28.2 million in cash (FY2025: A$1.9 million) and a net working capital surplus of A$16.2 million, against a restated deficit of A$96.8 million a year earlier. Most importantly, the financial statements in this Craig Bradshaw Managing Director report carry an unmodified audit opinion: the going concern qualification that attached to our previous accounts no longer applies. The liquidity and solvency challenges that defined the start of FY2026 are now well behind us. That outcome was only possible because our shareholders backed the Company when it mattered most. The recapitalisation came at a real cost – shares on issue increased from 2.7 billion to 5.1 billion – and we do not take that support lightly. Our obligation now is to convert a repaired balance sheet into sustained returns. Safety I must be equally direct about safety: our performance this year was well short of acceptable, and it will be a core focus of management in FY2027. At Barruecopardo, the lost time injury frequency rate improved from 22.5 to 15.8, a step in the right direction but still too high. At Mt Carbine, the LTIFR deteriorated from 36.6 to 43 – a result that is simply not good enough, despite significant effort and investment from management during the year. We have not waited for this report to act. Independent safety audits were completed at both operations during the second half, actions arising are well underway, and a new safety manager joins the Mt Carbine leadership team in the first quarter of FY2027. Structured training, toolbox engagement and comprehensive drug and alcohol testing continue across both sites. Nothing we mine is worth an injury, and the Board and I expect a step change in performance in the year ahead. 4 EQ Resources Limited Annual Report 2026
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