Announcement PDF DUXTON WATER LIMITED JUNE 2025 HALF-YEAR REPORT PROUDLY SUPPORTING AUSTRALIAN IRRIGATORS AND FARMERS ACN 611 976 517 CONTENTS Key Highlights 6 Directors’ Report 11 Lead Auditor’s Independence Declaration 27 Statement of Profit or Loss and Other Comprehensive Income 28 Statement of Financial Position 29 Statement of Changes in Equity 30 Statement of Cash Flows 31 Condensed Notes to the Financial Statements 32 Directors’ Declaration 45 Independent Auditors Review Report 46 Corporate Directory 48 HALF-YEAR 2025 SNAPSHOT Duxton Water Limited (“D2O”) provides investors with a direct and pure exposure to Australian water markets. D2O’s primary business activity is to build a diversified portfolio of water entitlements, and through active management, generate a return by offering a range of water supply products to Australian water users. 11.0% $291M PORTFOLIO RETURN (6 MONTHS) 1 WATER PORTFOLIO VALUE 2 1. Total portfolio return is based on post-tax NAV movements and includes franked dividends for the 6-month period to 30 June 2025. 2. Non-statutory Net Asset Value (NAV), adjusting for water entitlements held at cost in the Financial Statements of $228.5m. This includes permanent water entitlement acquisitions that are contracted but not yet settled. 3. Weighted Average Lease Expiry at 1 July 2025. $1.65 PER SHARE NONSTATUTORY NET ASSET VALUE (POST TAX) 2 59.0GL 52% TOTAL WATER OWNED LEASED PORTFOLIO 3.7 YEARS WALE 3 HALF-YEAR HIGHLIGHTS The first half of 2025 has been a transformational period for Duxton Water Limited (“the Company” or “D2O”). It was marked by record financial performance and strategic initiatives that have fundamentally strengthened the Company’s position. We are pleased to report exceptional results that demonstrate the value of our active portfolio management approach and strategic vision. Key highlights include: 1. Record Financial Performance: Delivered a record half-year Net Profit Before Tax of $35.3m (vs $11.8m in 1H2024). This strong result was supported by a 6-month total portfolio return of 11.0% (post-tax). 2. Significantly Improved Balance Sheet: Reduced gearing from 31% to 5% by repaying $98 million in debt during the half-year period, significantly enhancing balance sheet flexibility, and reducing interest expenses. 3. Strategic Portfolio Rebalancing: Sold $135.2 million of water entitlements to the Australian Government at a premium to our previous valuations, generating substantial gains for shareholders while maintaining a diversified portfolio. 4. Internalisation of Management: Obtained shareholder approval to internalise management, eliminating ongoing management and performance fees while maintaining operational continuity. 5. Improving Market Conditions: High security lease yields have improved to approximately 4-6%p.a. due to drier conditions and lower storage levels, with 52% of the portfolio leased, providing a stable income stream. RECORD FINANCIAL PERFORMANCE DRIVES SHAREHOLDER VALUE Duxton Water delivered its strongest half-year results since inception. The Company generated a record Net Profit Before Tax of $35.3 million, compared to the prior halfyear result of $11.8 million. This outstanding performance resulted in an 11.0% post-tax total return over the six-month period, with our non-statutory NAV increasing to $1.65 per share. This result reflects the continued execution of our operational strategy, underpinned by disciplined portfolio management and our ability to capitalise on favourable market conditions. The Company maintained its consistent dividend track record, paying a fully franked dividend of 3.71 cents per share in April 2025. PAGE 6 DUXTON WATER LIMITED HALF-YEAR REPORT BALANCE SHEET TRANSFORMATION ENHANCES FLEXIBILITY We have fundamentally transformed our balance sheet, reducing our net debt-toassets ratio (“LVR”) from 31% to 5% through the repayment of $98 million in debt. This significant deleveraging was achieved using proceeds from recent entitlement sales, positioning the Company with greater financial flexibility to pursue value-accretive opportunities. This enhanced balance sheet strength provides a range of benefits. It significantly reduces interest expenses, improves resilience across varying market conditions, and substantially increases our capacity for further strategic acquisitions. Our LVR now sits well below our 40% covenant limit, providing considerable headroom to support future growth initiatives. STRATEGIC PORTFOLIO REBALANCING Our active portfolio management approach delivered exceptional value through the strategic sale of $135.2 million of water entitlements at a premium to our previous valuations. This included $121.3 million sold to the Australian Government under the ‘EOI 2 - Large Portfolios’ program, plus an additional $13.9 million through the Selected Catchments Open Tender. These transactions allowed us to rebalance our portfolio by divesting non-core entitlements while maintaining a diversified exposure to our preferred holdings. The Company’s recent entitlement sales have generated substantial value for shareholders while supporting the Government’s environmental water recovery objectives under the Restoring Our Rivers program. MANAGEMENT INTERNALISATION DELIVERS OPERATIONAL ADVANTAGES At the Company’s May 2025 AGM, shareholders approved the internalisation of Duxton Water’s management team, and termination of the Investment Management Agreement (“IMA”) which occurred on 1 June 2025. This outcome followed a strategic review led by the independent directors ahead of the expiry of the Investment Management Agreement’s initial 10-year term. The review assessed the Company’s prior performance while considering the future direction of the Company. This strategic transition eliminates ongoing management and performance fees while providing direct control over operations and personnel. The internalisation process ensures operational continuity with Lachlan Campbell and Lachlan Beech becoming the Company’s first employees on 1 June 2025. Brendan Rinaldi stepped into the role of Independent Chairman, after serving on the board since 2022, and will lead our board through this next phase of growth. DUXTON WATER LIMITED HALF-YEAR REPORT PAGE 7 HALF-YEAR KEY HIGHLIGHTS 2025 IMPROVED MARKET CONDITIONS SUPPORT INCOME GENERATION After nearly four years of wet conditions that suppressed returns on high security water entitlements, market dynamics have shifted. High security lease yields have improved to approximately 4-6% p.a., driven by lower storage levels and the re-emergence of drier weather patterns across key agricultural regions. These improved market conditions, combined with our strategic positioning, has enabled us to maintain 52% of our portfolio under lease arrangements, providing a stable and predictable income stream. Recent conditions have driven increased demand for long-term water leases, supporting sustained higher lease rates for high security assets when compared to the 2021-2024 period. STRATEGIC FRAMEWORK EVOLUTION Building on our strong operational foundation, we are evolving our strategic framework to support long-term value creation. This includes reviewing our portfolio weightings to ensure optimal balance, refining our guidelines around dividends, debt usage and hedging, and strengthening internal capital management frameworks to guide future capital allocation decisions. These initiatives are designed to complement our existing strengths and enhance our ability to deliver sustainable returns across varying market cycles. OUTLOOK The combination of our strengthened balance sheet, improved market conditions, and enhanced operational control positions Duxton Water exceptionally well for continued value creation. We remain on track to complete the internalisation within the Transitional Services Agreement period, and we look forward to sharing more details on our refined strategic framework in the second-half of 2025. $1.84 per share (NAV pre-tax) 2.25 2.00 Lachlan Beech Portfolio Manager $ per share Lachlan Campbell Portfolio Manager 5.5 $1.52 per share (share price) 1.75 Brendan Rinaldi Independent Chairman 6.0 $1.65 per share (NAV post-tax) 5.0 4.5 1.50 4.0 1.25 3.5 1.00 2.3 0.75 2.4 2.5 2.6 2.7 2.9 2.8 3.0 3.1 3.2 3.3 3.4 3.5 3.6 3.7 3.71 3.0 2.5 2.0 1.5 0.50 1.0 0.25 Dividends Per Share (c) HISTORICAL PERFORMANCE - SINCE INCEPTION 0.5 0.0 Dividend Paid NAV per share (post-tax) Share Price Jun -25 Dec-24 Jun-24 Dec-23 Jun-23 Dec-22 Jun-22 Dec-21 Jun-21 Dec-20 Jun-20 Dec-19 Jun-19 Dec-18 Jun-18 Dec-17 Jun-17 Dec-16 Jun-16 0.00 NAV per share (pre-tax) NAV Per Share (Post-Tax) = Non-statutory Net Asset Value (NAV), adjusting for water entitlements held at cost in the Financial Statements of $228.5m. This includes permanent water entitlement acquisitions that are contracted but not yet settled. PAGE 8 DUXTON WATER LIMITED HALF-YEAR REPORT DUXTON WATER LIMITED HALF-YEAR REPORT PAGE 9 DIRECTORS’ REPORT FOR THE HALF-YEAR ENDING 30 JUNE 2025 The Directors of Duxton Water Limited submit herewith their Directors’ report, the financial report of Duxton Water Limited (“the Company”) or (“Duxton Water”) for the halfyear ended 30 June 2025 and the Independent Auditor’s Review Report. In order to comply with provisions of the Corporations Acts 2001, the Directors’ Report is as follows: DIRECTORS The names of the Directors of the Company that held office during and since the end of the interim period are: Mr Brendan Rinaldi Mr Edouard Peter Mr Stephen Duerden Mr Dirk Wiedmann Mr Dennis Mutton Dr Vivienne Brand The above named Directors held office since the start of the financial year unless otherwise stated. The office of Company Secretary is held by Mrs Katelyn Adams. PRINCIPAL ACTIVITIES There has been no change in the principal activities of the Company. The Company has continued to actively manage a portfolio of Australian water entitlements primarily focused in the southern Murray-Darling Basin. Income is derived through the provision of water supply solutions to mainly primary producers through a combination of long-term lease arrangements, and the sale of temporary water allocations to support Australian agricultural production. There were no significant changes in the nature of the activities of the Company during the period. PAGE 10 DUXTON WATER LIMITED HALF-YEAR REPORT DUXTON WATER LIMITED HALF-YEAR REPORT PAGE 11 DIRECTORS’ REPORT FOR THE HALF-YEAR ENDED 30 JUNE 2025 REVIEW OF OPERATIONS OPERATIONAL PERFORMANCE • Duxton Water delivered a record half-year Net Profit Before Tax of $35.3 million for the period ended 30 June 2025 (1HY2024: $11.8 million). • The Company paid a fully franked dividend of 3.71 cents per share in the first-half of 2025 (1HY2024: 3.60 cents per share). • Recorded a total NAV return of 11.0% during the period. • Substantially reduced LVR from 31% to 5%. • Internalisation of management and key operational functions is underway. 52% Over the last 6 months: HY2025 HY2024 Difference Share Price $1.52 $1.39 +13 cents NAV per share (post-tax) 1 $1.65 $1.51 +14 cents 3.71 cents 3.60 cents +0.11 cents $291m $354m -$63m Water Owned (GL) 59.0GL 87.3GL -28.3GL Leased % 52% 61% -9% Dividends Paid Water Portfolio Valuation ($m) 1 WATER PORTFOLIO DIVERSIFICATION Recurring revenue from the Company’s long-term lease portfolio remained resilient, providing a stable and predictable revenue stream throughout the half-year. With 52% of the portfolio leased, the Company is well positioned to generate consistent lease income while retaining flexibility to capitalise on improving market conditions. Toward the end of the half-year period, the Company secured several new lease agreements with both existing and new counterparties. These agreements enabled the Company to maintain its leased percentage at 52% from 1 July 2025. Without securing these new lease agreements, the Company’s opening leased percentage would have been reduced to 38%. This increased lease percentage provides the Company with greater revenue certainly heading into the new water year. Unleased 2% 14% 4% 77% Murray 3% Murrumbidgee Goulburn Lachlan Mallee WATER SECURITY BREAKDOWN 17% 80% HS 3% GS Portfolio rebalancing Active management of its unleased water allocations Equivalency leasing Duxton Water remains committed to actively managing its portfolio to optimise performance through cycles. The Company’s operational strategy continues to focus on balancing long-term lease income with active trading, underpinned by disciplined risk management, and a strong understanding of market fundamentals. ENTITLEMENT VALUE BY REGION The Company has recorded its strongest half-year result since inception. This was primarily driven by the successful execution of its portfolio rebalancing strategy. The result was underpinned by a significant gain on the sale of 32.6 GL of water entitlements to the Commonwealth Government through its voluntary entitlement buyback programs. These entitlements were sold at a premium to previous valuations, delivering substantial gains. At 30 June 2025, Duxton Water’s portfolio comprised of 59.0 GL of permanent water entitlements, with a fair market value of $291 million. • • • 48% Leased ACTIVE MANAGEMENT The Company’s recent positive results highlight the benefits of investing in an actively managed portfolio. Over the last six-months the Company has generated significant value for shareholders through: Groundwater PORTFOLIO REBALANCING Duxton Water actively reviews and adjusts its portfolio composition to respond to shifting market conditions and valuation opportunities. This rebalancing strategy involves selective acquisition and divestment of water entitlements to enhance capital efficiency, manage exposure to specific entitlement types, and optimise long-term returns. By targeting assets with attractive value propositions and strategic relevance, the Company ensures its portfolio remains aligned with both income and growth objectives across varying climate and market cycles. UNLEASED WATER ALLOCATIONS The Company maintains a disciplined approach to managing its unleased water allocations, seeking to maximise short-term income while maintaining flexibility to meet future leasing or trading opportunities. This includes the strategic timing of forward and allocation sales to capture favourable market prices, as well as reserving volumes to meet contractual or seasonal demand from irrigators. Through proactive engagement with the market and close monitoring of supply-demand dynamics, the Company aims to maximise utilisation of its uncommitted allocation holdings. EQUIVALENCY LEASING Equivalency leasing is a flexible water delivery mechanism that enables Duxton Water to meet customer delivery requirements using its whole portfolio (where permitted). By leveraging its water market knowledge, the Company can offer irrigators consistent access to water even when specific entitlement types are limited, without compromising operational reliability. TAILORED LEASE SOLUTIONS Duxton Water continues to support the development of sophisticated water strategies to its customers, advocating for long-term planning that accounts for both market pricing uncertainty, and climatic variability. The Company remains committed to providing secure, reliable water access through tailored leasing structures that align with the evolving needs of its customer base. The Company is currently working with several customers to design bespoke water supply solutions. 1. Non-statutory value, adjusting for water entitlements held at cost in the Financial Statements of $228.5m. At 30 June 2025, the Company’s statutory Post-Tax Net Asset Value is $1.37 per Share. DUXTON WATER LIMITED HALF-YEAR REPORT PAGE 13 DIRECTORS’ REPORT FOR THE HALF-YEAR ENDED 30 JUNE 2025 DIRECTORS’ REPORT FOR THE HALF-YEAR ENDED 30 JUNE 2023 PORTFOLIO SUMMARY AT 30 JUNE 2025 Duxton Water owns and operates a diversified portfolio of Australian water entitlements across 18 different entitlement types and zones. At 30 June 2025, Duxton Water’s portfolio is valued at $291 million¹ (30 June 2024: $354 million). The decline in portfolio valuation reflects the sale of 32.6 GL of water entitlements to the Government under the 2025 buyback program. Meanwhile, the value of the remaining portfolio broadly increased in value, in-line with the 2.7% uplift that was observed in the Ricardo Entitlement Index over the first-half. ENTITLEMENT TYPE HELD 31/12/2024 ML CHANGE 30/06/2025 VIC 1A Goulburn HR 13,114 (13,114) - VIC 1A Goulburn LR 1,401 - 1,401 VIC 1B Boort HR 376 - 376 VIC 3 Goulburn HR 421 - 421 VIC 6 Murray HR 5,817 - 5,817 VIC 6 Murray LR 313 - 313 VIC 6B Murray HR 1,344 - 1,344 VIC 7 Murray HR 7,337 40 7,377 NSW Murray 10 HS 6,260 (3,010) 3,250 NSW Murray 10 GS 14,491 (14,491) - NSW Murray 11 HS 6,650 (1,000) 5,650 NSW Murray 11 GS 7,225 (1,000) 6,225 NSW Murray 11 Supp 83 - 83 NSW Murrumbidgee 13 HS 2,390 - 2,390 NSW Murrumbidgee 13 GS 7,322 - 7,322 NSW Lachlan Valley – Jemalong Irrigation GS 2,660 - 2,660 NSW Lachlan Valley – GS 4,504 - 4,504 SA Murray HS 6,248 27 6,275 SA Mallee Prescribed Wells Area – Parilla Red Zone 500 - 500 SA Mallee Prescribed Wells Area – Parilla Green Zone 3046 - 3046 Total 91,502 (32,548) 58,954 Breakdown by zone of permanent water entitlements held by the Company at 30 June 2025. 1. Non-statutory value, which adjusts statutory water entitlements held at cost of $228.5m to fair market value of $291m. PAGE 14 DUXTON WATER LIMITED HALF-YEAR REPORT DUXTON WATER LIMITED HALF-YEAR REPORT PAGE 15 DIRECTORS’ REPORT FOR THE HALF-YEAR ENDED 30 JUNE 2025 DIRECTORS’ REPORT FOR THE HALF-YEAR ENDED 30 JUNE 2025 SOUTHERN BASIN DAM STORAGE LEVELS (ANNUAL) MARKET OVERVIEW Major southern Murray-Darling Basin (“sMDB”) storages fell to their lowest levels (for 30-June) since 2020. Increased uncertainty and the chance of drier conditions prompted irrigators to reassess future water needs, leading many to secure additional supply ahead of the upcoming season. This surge in demand drove allocation prices to higher levels across most major systems when compared to the previous 3-4 years. In the lower Murray, allocation prices held relatively stable between $130 - $150/ML between July 2024 and December 2024. That being said, allocation prices climbed steadily to finish at ~$270/ML by June 2025. This upward pressure was driven by tightening supply and expectations of lower opening allocations following below-average inflows during the year. The rising spot price also drove demand for lease and forward allocation contracts, as some irrigators opted for multi-year approaches. 30-Jun-21 30-Jun-22 30-Jun-23 30-Jun-24 30-Jun-25 Dartmouth 67% 95% 97% 94% 69% Hume 61% 94% 97% 67% 34% Lake Eildon 59% 83% 97% 88% 56% Blowering 96% 97% 93% 74% 48% Burrinjuck 98% 87% 91% 75% 43% Menindee Lakes 63% 110% 83% 62% 71% Weighted Average 69% 94% 94% 80% 55% SEASONAL OPENING ALLOCATION AWARDS NSW Murray SA Murray Murrumbidgee 1-Jul-23 1-Jul-24 1-Jul-25 HR 33% 66% 100% 69% 31% 100 100 LR 0% 0% 0% 0% 0% 90 90 HR 21% 94% 88% 66% 39% 80 80 LR 0% 0% 0% 0% 0% 70 70 HS 97% 97% 97% 97% 97% 60 60 GS 3% 43% 55% 35% 1% 50 50 HS 100% 100% 100% 100% 100% 40 40 GS N/A N/A N/A N/A N/A 30 30 HS 95% 95% 95% 95% 95% 20 20 GS 30% 35% 37% 28% 4% 10 10 The entitlement market has shown signs of renewed strength. From 1 July 2024 to 30 June 2025, entitlement values increased approximately 5.7% (Ricardo Entitlement Index), reversing much of the weakness experienced throughout 2023 and early 2024. While market depth remains thinner than in peak trading periods, buyer interest remains strong and has broadened across entitlement types. 0 Jun 18 Jun-19 Dartmouth Dam The Company remains focused on actively managing its portfolio in line with changing market dynamics, maintaining a long-term strategy centred on delivering stable, risk-adjusted returns through diversified entitlement exposure and disciplined capital allocation. Jun-20 Hume Dam Jun-21 Lake Eildon Dam Jun-22 Blowering Dam Jun-23 Burrinjuck Dam Jun-24 Jun-25 Menindee Lakes DAILY INFLOWS TO THE MURRAY DARLING BASIN 50,000 SYSTEM INFLOWS AND STORAGE LEVELS At 30 June 2025, sMDB storages closed at a weighted average of 55%. This is the lowest year-end weighted average storage level recorded since 2020. This result reflects a combination of below-average rainfall, reduced inflows, and elevated demand from irrigators in response to persistent drier conditions. 45,000 40,0001 35,000 Megalitres (ML/d) Across the 2024/2025 water year, the sMDB experienced its most notable storage drawdown during late summer and early autumn, when rainfall across key catchments was limited. The Company anticipates that rainfall and inflows to major storages in the coming months will likely influence allocation determinations and spot prices leading into summer. 0 Jun-17 30,000 25,000 20,000 15,000 10,000 5,000 0 Jul Aug Sep 2022-23 WY PAGE 16 DUXTON WATER LIMITED HALF-YEAR REPORT Oct Nov 2023-24 WY Dec 2024-25 WY Jan Feb 2025-26 WY Mar Apr May Jun Long term average DUXTON WATER LIMITED HALF-YEAR REPORT PAGE 17 Percentage % VIC Murray 1-Jul-22 Percentage % Goulburn AGGREGATE RIVER MURRAY DAM STORAGES 1-Jul-21 DIRECTORS’ REPORT FOR THE HALF-YEAR ENDED 30 JUNE 2025 WEATHER OUTLOOK Heading into the 2025/26 water year, prevailing climate indicators suggest an increased likelihood of wetter than average conditions. This marks a notable shift from the outlooks provided earlier this year, which pointed to a higher probability of drier than average conditions for large areas of Australia. GOVERNMENT WATER BUYBACKS The Commonwealth Government has continued to progress its water recovery initiatives in the first-half of 2025 under the following three programs: • Resilient Rivers • Sustainable Communities This change in forecast serves as a reminder of the inherent unpredictability of weather patterns and the importance of having a well-defined strategy in place. It also highlights the need for Duxton Water to maintain a diversified and balanced portfolio that can perform effectively across a wide range of climatic scenarios. • Voluntary Water Purchases Rainfall across the sMDB during the first-half of 2025 has been mixed. South-eastern regions experienced significantly below-average rainfall, resulting in drought like conditions in parts of South Australia and Victoria. Conversely, the north-eastern regions recorded well aboveaverage rainfall, triggering significant flooding events in Queensland and northern New South Wales. The Government has three distinct programs with respect to voluntary water purchases. The El Niño Southern Oscillation (“ENSO”) is currently in a neutral phase. However, the Bureau of Meteorology continues to maintain a La Niña Watch, indicating a 50% chance of La Niña developing during spring. Historically, La Niña events have been associated with increased rainfall across eastern and northern Australia. 70 65 55 50 45 40 35 30 25 20 80 70 65 55 50 45 40 35 30 25 20 CHANCE OF EXCEEDING MEDIAN MIN TEMP. (%) 80 CHANCE OF EXCEEDING MEDIAN RAINFALL(%) Similarly, the Indian Ocean Dipole (“IOD”) remains in a neutral state. However, all international models, including the Bureau of Meteorology, are forecasting a negative IOD to occur during Spring 2025, with an expected return to neutral in early summer. CHANCE OF EXCEEDING THE MEDIAN RAINFALL FOR SEPTEMBER TO NOVEMBER 2025 Together these programs aim to recover 450 GL of water entitlements for environmental purposes across the MDB. TENDER 1 - RESTORING OUR RIVERS SELECTED CATCHMENT OPEN TENDER: This tender for 70GL closed in September 2024 and the Government started accepting tenders in December 2024 with evaluation continuing into 2025. On 6 August 2025, the Government announced that Tender 1 has now concluded and that no more offers were being accepted. EOI 1 - REMAINING SOUTHERN CONNECTED BASIN: This EOI closed in November 2024 and was open to water entitlement holders that were not eligible to participate in Tender 1. In June 2025, the Government advised that as part of EOI 1, it had received over 1,000 submissions for over 160 GL of water entitlements. Approximately half of these submissions aligned with appropriate pricing and represented ‘value for money’. EOI 2 - LARGE PORTFOLIOS: This EOI closed in late 2024 and was open to owners of water entitlement portfolios who were willing to sell ~20GL or more. In February 2025, the Government commenced a program to purchase up to 100 GL of entitlements through this process. PROGRESS - 31 MARCH 2025 The following table shows progress towards the 450 GL target for enhanced environmental outcomes at 31 March 2025: Target Water recovery registered Water recovery contracted (not yet registered) Remaining recovery 450.0 GL/y 104.1 GL/y 53.2 GL/y 292.7 GL/y https://www.dcceew.gov.au/water/policy/water-recovery/progress With respect to future buybacks, the government is taking a staged approach, with future purchases to be guided by program results, expert advice, and market analysis. Under the current legislation, all recoveries must be contracted to meet the 450 GL target by 31 December 2027. https://www.dcceew.gov.au/sites/default/files/documents/restoring-our-rivers-delivering-450gl-implementation-plan-july-2025-update.pdf CHANCE OF EXCEEDING THE MEDIAN MINIMUM TEMPERATURE FOR SEPTEMBER TO NOVEMBER 2025 1. Bureau of Meteorology - Long-Range Forecast - Issued 21 August 2025. 2. Bureau of Meteorology - Climate Driver Update - Issued 21 August 2025. DUXTON WATER LIMITED HALF-YEAR REPORT PAGE 19 DIRECTORS’ REPORT FOR THE HALF-YEAR ENDED 30 JUNE 2025 DIRECTORS’ REPORT FOR THE HALF-YEAR ENDED 30 JUNE 2024 FINANCIAL OVERVIEW During the period ended 30 June 2025, the Company: • Recorded its highest ever half-year Net Profit Before Tax of $35.3 million. • Paid a fully franked dividend of 3.71 cents per share in April 2025. • Reduced drawn debt by $98 million, enhancing balance sheet flexibility. Over the last 6 months, water entitlement prices have started to rebound, contributing to an increase in the Company’s post-tax NAV¹. As of 30 June 2025, the Company’s post-tax NAV¹ based on Fair Market Value was $1.65 per share, compared to $1.54 per share as of 31 December 2024. The Company maintained a strategic and proactive approach to managing its portfolio of water entitlements. In the first-half of 2025, the Company successfully realised a $34.3 million gain from the sale of permanent water entitlements. As of 30 June 2025, the Company is carrying $61.8 million (or $0.40 per share) in unrealised gains on the water portfolio. These unrealised gains are excluded from the statutory financial statements due to the application of Australian Accounting Standards. The statutory NAV of the Company, in accordance with Australian Accounting Standards (which excludes unrealised gains), is $1.37 per share at 30 June 2025, up from $1.25 per share at 31 December 2024. VALUATION EXPERT The portfolio continues to be valued on a dry equivalent basis by Ricardo Energy, Environment & Planning Pty Ltd (previously Aither Pty Ltd). Ricardo PLC employs a market valuation approach to determine a Fair Market Value, which draws on publicly available water trade data from the relevant state water registers as well as analysis of trade data obtained from market intermediaries to calculate a dollar per ML volume weighted average price for each entitlement and allocation type. The Fair Market Value is not in accordance with the recognition and measurement requirements of the Australian Accounting Standards in relation to the accounting treatment of water assets (intangible assets). Therefore, increases in the Fair Market Value of water assets are not reported in the statutory accounts. For financial statement reporting purposes, in accordance with the basis of preparation described in Note 2 of the financial statements, the Company’s permanent water entitlements are carried at cost less any accumulated impairment losses. Temporary water allocations related to these entitlements are recognised in the Statement of Financial Position at zero cost initially. Purchased temporary water allocations are recognised at cost when acquired. Presented below is a summary of the Company’s NAV on a Fair Market Value basis compared to the basis of preparation described in Note 2 of the financial statements. 1. Non-statutory value, which adjusts statutory water entitlements held at cost of $228.5m to fair market value of $291m. PAGE 20 DUXTON WATER LIMITED HALF-YEAR REPORT DUXTON WATER LIMITED HALF-YEAR REPORT PAGE 21 DIRECTORS’ REPORT FOR THE HALF-YEAR ENDED 30 JUNE 2025 30 June 2025 Company Statement of Financial Position $’000 Fair Market Value* $’000 (non statutory) Variance $’000 ASSETS Permanent water entitlements 228,537 290,362 61,825 Contracted water acquisitions - 259 259 Temporary water entitlements - 142 142 Net current and deferred tax assets (292) (18,842) (18,550) Net other current assets 3,343 3,089 (254) Net non-current liabilities (18,003) (18,003) - TOTAL NET ASSETS 213,585 257,008 43,424 $1.37 $1.65 $0.28 Company Statement of Financial Position $’000 Fair Market Value* $’000 (non statutory) Variance $’000 Permanent water entitlements 303,874 354,052 50,178 Temporary water entitlements - 37 37 Net current and deferred tax assets 627 (13,377) (14,004) Net other current assets 1,510 1,510 - Net non