Orica : 2021 AGM Speeches

ORICA ORICA LIMITED 2021 ANNUAL GENERAL MEETING	1

For personal use only

ASX RELEASE

16 DECEMBER 2021

ORICA LIMITED 2021 ANNUAL GENERAL MEETING

Speeches by Malcolm Broomhead, Chairman and Sanjeev Gandhi, Managing Director and Chief Executive Officer

Malcolm Broomhead, Chairman

Before we move on to the resolutions as outlined in the Notice of Meeting, I would like to make some remarks on what I believe are areas important to Orica, and to you, our valued shareholders.

Firstly, I will talk about our performance over the year, important remuneration changes as well as governance and then I would like to talk more broadly about sustainability, both in what Orica is doing today and the broader industry context.

Performance

It has been a challenging year, with COVID-19 disruptions, geopolitical issues, and other external and internal factors impacting our people and results.

The Board and I are extremely proud of how the Orica people have risen to the challenges and shown unwavering commitment and resilience towards each other, our customers, and the communities in which we operate.

Despite the ongoing challenges presented this year, safety remained the highest priority across our organisation. I am pleased to report that, once again, we had no fatalities across our operations. Disappointingly, our Serious Injury Case Rate increased by 0.03 to 0.19. Preventing serious injuries will remain a key focus this year.

Our focus again has remained on the health and wellbeing of our people this year. We continue to provide support for employees and their families in areas most impacted by COVID-19 and sadly, we lost twelve colleagues to COVID-19. We extend our deepest condolences to the families and friends of our colleagues who lost their lives.

In September, we announced individually significant items impacting our results by $382 million after tax, which resulted in a statutory Net Loss after Tax (NLAT) of $174 million, compared to a Net Profit after Tax (NPAT) of $82 million in the 2020 financial year.

Underlying Earnings Before Interest and Tax (EBIT) were $427 million - a decrease of 30 per cent from the prior year.

Authorised for release to the ASX by the Company Secretary of Orica Limited

Orica Limited, 1 Nicholson Street East Melbourne VIC 3002 Australia. ABN 24 004 145 868

ORICA ORICA LIMITED 2021 ANNUAL GENERAL MEETING	2

For personal use only

The final ordinary dividend of 16.5 cents per share, unfranked, brings the total dividend to

24.0 cents per share, down 9 cents per share compared with the 2020 financial year, reflecting a payout ratio of 47 per cent of underlying earnings.

Positively, we maintained a disciplined approach to our balance sheet and capital management, while stepping up our cash generation and controlling our levels of debt and gearing. Our cash position was notably enhanced by the sales of non-core landholdings during the year.

On an operational front this year, I am pleased to report that despite the challenges, we were able to achieve the key planned initiatives within our control, including:

• achieving our new technology targets;
• the successful integration of Exsa into Orica;
• our Burrup ammonium nitrate plant becoming fully operational;
• the acceleration of our discrete network and product portfolio optimisation programs; and
• continued execution of our global restructuring program, supported by the continued stabilisation of the SAP system.

Sanjeev will talk in more detail about these initiatives shortly.

In April 2021, the Board appointed Sanjeev Gandhi as the new Managing Director and CEO of Orica Limited. Sanjeev also took the opportunity to reshape the Executive Committee, assembling a strong leadership team with deep expertise and experience from across the organisation.

Sanjeev and the Executive Committee have the full support of the Board and with the refreshed strategy, an improving employee culture and business environment, we are confident in their ability to navigate Orica's recovery and deliver profitable growth and shareholder returns.

Remuneration

Given financial performance over the 2021 financial year, the Board exercised its discretion not to award any payments under the Executive STI plan to the CEO or other Executives.

To further align Executive and Board remuneration with value delivered to shareholders, the Board made several key decisions during the year in relation to remuneration.

First, we took the opportunity to reshape the CEO remuneration package with the appointment of Sanjeev Gandhi as Managing Director and CEO. A substantial portion of the CEO's FAR is now provided in equity which ensures immediate and ongoing alignment with the shareholder experience. We also addressed feedback from our investors and decreased the CEO's maximum short-term incentive (STI) opportunity from 200% to 150%, and the long-term incentive (LTI) grant opportunity from 215% to 200%.

Second, no remuneration increases were received by Executives who remained in the same role during the 2021 financial year. For those individuals whose role changed as part of the reshaping of our Executive Committee, their fixed annual remuneration was set lower than the prior incumbent.

Authorised for release to the ASX by the Company Secretary of Orica Limited

Orica Limited, 1 Nicholson Street East Melbourne VIC 3002 Australia. ABN 24 004 145 868

ORICA ORICA LIMITED 2021 ANNUAL GENERAL MEETING	3

For personal use only

Third, to reflect the disappointing results for the shareholders, Board fees did not change in the financial year 2021 and will also remain at the same level for financial year 2022. In addition, I elected to forfeit my Board Chair fees from 1 June to 30 September 2021 in support of our cost reduction focus in the second half of FY2021.

Finally, during the 2021 financial year the Board undertook a formal review of our Executive Remuneration Framework, engaging with shareholders and other stakeholders as part of this process to better understand their view of our current framework and practices. In addition to the revised CEO remuneration structure, two key changes have been made to our Executive incentive plans from the 2022 financial year:

1. A Relative Total Shareholder Return (rTSR) metric was introduced into the LTI to complement Return on Net Asset (RONA) as a second equally weighted metric to better support the implementation of our transformation program.
2. Recognising the importance of monitoring the environmental impact of our operations, in the 2021 financial year we introduced Loss of Containment (LOC) as an environmental metric within our STI scorecard. For the 2022 financial year, the renamed 'Safety and Sustainability' component of our STI scorecard will include a greenhouse gas emissions-based metric in addition to LOC. The new metric is aligned with our stated objective to reduce Scope 1 and 2 operational emissions by at least 40% by financial year 2030.

Governance

Moving to governance.

The Board recognises that sound corporate governance has never been more important. Responsible business behaviours and processes, and transparency, are critical to maintaining the trust of our stakeholders, particularly as we navigate the challenges presented by our external operating environment.

This year focus areas of your Board included:

1. strategy and business performance;
2. people and culture;
3. risk management;
4. sustainability;
5. technology and innovation; and
6. safety and corporate responsibility.

You can read more about our work in these areas in our 2021 Annual Report.

The skills, experiences and diversity of your Board are reviewed regularly to ensure they are aligned to achieving our strategic objectives and we undertake Board renewal appropriately.

Sustainability

Now, focusing on sustainability.

Increases in global temperatures and climate change are impacting weather extremes across the globe. Our industry and customers have progressed efforts towards more sustainable activities by plotting out various technological routes and reducing greenhouse

Authorised for release to the ASX by the Company Secretary of Orica Limited

Orica Limited, 1 Nicholson Street East Melbourne VIC 3002 Australia. ABN 24 004 145 868

ORICA ORICA LIMITED 2021 ANNUAL GENERAL MEETING	4

For personal use only

gas emissions across processes, practices and products in order to combat climate changes.

Around the world, different industries, operating in different jurisdictions and serving different commodities require distinct approaches to climate change as the world transitions to a low carbon economy. Orica is acutely aware of these variances, and we are tailoring our solutions to suit the ever-changing market, customer and societal demands.

Although we are predominately focused on where we can have the biggest impact on climate today, our own emissions, by deploying low-emissions technologies to our major manufacturing sites and working with our global suppliers and stakeholders to reduce the footprint of our global supply chain. We are also partnering to help them achieve their own sustainability goals into the future as well.

Despite COVID-19 and the challenges associated with our financial performance, we continued to focus on the delivery of our sustainability commitments, delivering a 13 per cent reduction in our combined Scope 1 and 2 greenhouse gas emissions from 2019 levels, and we remain on track to achieve our target of at least 40 per cent reduction in Scope 1 and 2 greenhouse gas emissions by 2030.

In recognition of COP26 and the increasing global focus on tackling climate change, this year, we took a significant step in our sustainability journey and established a net zero ambition by 2050. Building on our target to reduce Scope 1 and 2 emissions by at least 40 per cent by 2030, this new ambition includes our most material Scope 3 emission sources.

We also continued to strengthen our climate governance and linked the achievement of our emissions reduction targets to executive remuneration.

Our commitment to sustainability goes beyond our net zero ambition. We will continue to evolve our approach to deliver long-term value for our stakeholders and will be working to achieve more in delivering on our key social, diversity and environmental targets in the coming year.

Sanjeev will talk in more detail about some of our sustainability achievements shortly.

Conclusion

Before I invite Sanjeev to talk about our performance, refreshed strategy and sustainability in more detail, I would like to sincerely thank, on behalf of the Board, the entire Orica team who have been exceptional during yet another challenging year.

Importantly, we thank you, our shareholders, for your continued support and investment in Orica.

The Board and I are confident that the fundamentals of Orica remain strong. The refreshed strategy and Executive leadership team have Orica well positioned to navigate the recovery and deliver profitable growth by seizing opportunities as the market stabilises, delivering value for our customers and shareholders through a simpler and more efficient organisation.

I now welcome your Managing Director and Chief Executive Officer, Sanjeev Gandhi, to address you.

Authorised for release to the ASX by the Company Secretary of Orica Limited

Orica Limited, 1 Nicholson Street East Melbourne VIC 3002 Australia. ABN 24 004 145 868

ORICA ORICA LIMITED 2021 ANNUAL GENERAL MEETING	5

For personal use only

Sanjeev Gandhi, Managing Director and CEO

Thank you, Chairman and thank you to our shareholders for joining us today.

This morning, I will talk about our performance over the past year, our refreshed strategy, our approach to sustainability, and the outlook for the year ahead.

Safety

At Orica, nothing is more important than safety and we are pleased to report that, once again, we had no fatalities across our operations.

As Malcolm said earlier, disappointingly, there was a slight increase in our Serious Injury Case Rate. Preventing serious injuries will remain a key focus for us this year.

As COVID-19 continued to impact our activities and the communities we operate in, we remained focused on the health and well-being of our people and community initiatives and investments. Our employees went to extraordinary lengths, working with customers to protect their workplaces and communities and ensuring uninterrupted operations.

As we emerge from the pandemic, we are partnering with customers and governments to proactively introduce vaccination standards and programs across our operations.

Performance

Our financial performance has been disappointing due to the impact of COVID-19, a strong Australian dollar and ongoing trade tensions with China. Overall, we delivered an underlying EBIT of $427 million - a decrease of 30 per cent.

Despite this drop in performance, we maintained a disciplined approach to our balance sheet and capital management, while stepping up our cash generation and controlling our levels of debt and gearing. Gearing of 34.6 per cent remains within our target range of 30 to 40 per cent.

We are pleased to report that in the 2021 financial year, our Burrup plant, a long-term strategic asset positioned in the Pilbara, became fully operational; and Exsa, Peru's leading manufacturer and distributor of industrial explosives, acquired in May 2020, was successfully integrated into Orica and continues to deliver in line with the business case.

Our discrete network and product portfolio optimisation programs have been accelerated, resulting in the closure of several sites and the exit from a number of countries that are not strategically aligned or could be serviced through alternate distribution channels.

This year we also sold some of our non-core landholdings, and just this week we announced the sale of the Minova business. We continued to stabilise the recently implemented SAP ERP system, with the integrated platform helping us align our overheads and operating model with the current environment.

Despite challenges in roll-out due to COVID-19 restrictions, we were able to achieve our new technology returns target. Our digital solutions portfolio continues to grow and is now active across more than 200 customer sites globally, as we expand our expertise and capability beyond blasting.

It was a difficult year for our people through a time of significant organisational change as we adapted our business to the current operating environment. However, our people rose

Authorised for release to the ASX by the Company Secretary of Orica Limited

Orica Limited, 1 Nicholson Street East Melbourne VIC 3002 Australia. ABN 24 004 145 868