Audited financial statements for period ended 30 June 2020

NZX Announcement 26 November 2020 NZX Market Announcement: Audited financial statements for period ended 30 June 2020 Background SMW Group Limited (NZX:SMW) (SMW Group) was formerly known as Aorere Resources Limited. On 8 July 2020, SMW Group disposed of its net assets through an in-specie share distribution. It then acquired the following Australian companies (the Transaction): oAll Industrial Network Limited (AIN); oAlertvale Pty Ltd (Alertvale); and oBAE Engineering & Solar Pty Ltd (BAE) (together, the Subsidiaries). After acquiring the Subsidiaries: oSMW Group changed its company name from "Aorere Resources Limited" to "SMW Group Limited" and its NZX ticker code from "AOR" to "SMW"; oChris Leon, John (Jack) Trenaman, Oliver Sabu and Greg Kern were appointed as Directors ofSMW Group and Simon Henderson, Peter Liddle and Linda Sanders resigned (with Chris Castle and Jill Hatchwell remaining on the Board as New Zealand based Directors); and oSMW Group changed its balance date from 31 March to 30 June. Financial statements While the Transaction did not take place until 8 July 2020, SMW Group had the financial statements of each of the Subsidiaries audited for the year ended 30 June 2020. Attached to this Announcement are the following: oAudited financial statements of SMW Group for the 3 months ended 30 June 2020 to align with the change in balance date from 31 March to 30 June. Audited financial statements for the year to 31 March 2020 have previously been released to market. The financial statements have been prepared in accordance with NZ IFRS oAudited special purpose financial statements of AIN for the 13 month period ended 30 June 2020 oAudited special purpose financial statements of Alertvale for the year ended 30 June 2020 oAudited special purpose financial statements of BAE for the year ended 30 June 2020 The special purpose financial statements of AIN, SMW and BAE have been prepared in accordance with Australian IFRS. Financial performance for the year ended 30 June 2020 As a result of the Transaction, SMW Group's business has changed to that of developing and operating business interests in the mining support, construction and engineering services industries, which is in line with AIN's business interests and expertise. The SMW Group, post the Transaction merged two established Australian service businesses which seek to deliver mining support services to the entire Bowen Basin in Central Queensland in Australia. The Australian operating entities comprise of the following: oAlertvale a leading mining and industry services provider based in Rockhampton, at the Southern end of the Bowen Basin. It primarily provides services to mines in the Bowen Basin and has the ability to effectively service the Galilee Basin which is also in Central Queensland. Alertvale has strong customer relationships with a number of well-established market leading mining and infrastructure companies, including BHP, Anglo American, Coronado Curragh, Glencore, Aurizon (rail transport services) and the Rockhampton Regional Council oBAE based in Mackay, provides specialised mining support services and mineral processing equipment to the mining and construction industries. BAE primarily operates in Central Queensland, currently providing services to mines in the Northern Bowen Basin and, like Alertvale, has the ability to efficiently service the Galilee Basin. BAE has strong customer relationships with a number of major mining companies in the Northern Bowen Basin, including BMA, Glencore, Leighton, Thiess, Anglo American and Energex On 29 September 2020, the SMW Group made an announcement setting out the pro forma financial information for the SMW Group as if the Subsidiaries were all part of the SMW Group for all relevant periods. This financial information was based on unaudited financial information for the period ended 30 June 2020. The financial information presented in the table below has been updated for the audited financial information of the Subsidiaries which are prepared in accordance with the recognition and measurement requirements specified by Australian Accounting Standards and Interpretations. The proforma adjustments to the audited financial information remain consistent with that disclosed in the Listing Profile dated 10 June 2020 and are unaudited. See attached announcement for proforma adjustments to the audited financial information for the financial year ended 30 June. SMW Group has experienced revenue growth over the past 3 years largely due to the pre-COVID-19 recovery of coal prices and the associated increase in mining related investment. This growth continued for FY2020 with SMW Group experiencing an increase in revenue of around 30%. Both Alertvale and BAE achieved revenue growth in FY2020. The revenue growth, together with continued focus on cost control have contributed to the increase in EBITDA for the SMW Group. The outbreak of the COVID-19 pandemic has had an impact on the global mining industry as Government restrictions and general economic uncertainty have led to a prolonged contraction of commodity prices. The lower commodity prices have directly impacted SMW Group's customers' margins and many customers have revisited their operating and maintenance plans which in turn, has led to a rationalisation of operating and capital expenditure. As a provider of services to the mining industry, SMW Group has observed a reduction in levels of activity which has impacted the reported revenue. These challenges aside, SMW Group continues to maintain strong relationships with its customers and is optimistic that activity levels will improve in the near future as commodity prices rebound. As previously announced, the proforma financial information includes an estimate of the annual ongoing corporate costs for a publicly listed company even though the acquisition completed post year end. Financial Reporting Standards There have been several changes in financial reporting standards with the most significant impacting the SMW Group being NZ IFRS 16 (Leases) which has replaced NZ IAS 17 (Leases) and the Subsidiaries adopted IFRS 16 for the first time at 30 June 2020. The proforma financial information for the year ended 30 June 2020 includes the impact of the adoption of this Standard using the modified retrospective approach and applying the practical expedients detailed within the Subsidiaries audited financial information. The impact for the adoption of IFRS 16 by the Subsidiaries for the year ended 30 June 2020 is outlined in the attached announcement. The increase in EBITDA outlined above represents SMW Group's total lease expense impacted by IFRS 16 for the year ended 30 June 2020. There are no significant recognition and measurement differences between Australian Accounting Standards and Interpretations and IFRS. NZ IFRS has the same recognition and measurement requirements as IFRS. Therefore, SMW Group considers that the calculations, principles and policies used to prepare the pro forma financial information are consistent with GAAP and any variation from fully GAAP compliant statements would be immaterial. Other than the impact from the adoption of IFRS 16, there are no material variances from the pro forma financial information announced on 29 September 2020 to that included in this announcement. Consolidated financial statements for the half year accounts to 31 December 2020 The first consolidated, SMW Group financial statements that will be prepared under NZ-GAAP will be for the six-month period ending 31 December 2020. The six-months to 31 December 2020 will include: othe finalisation of the reverse acquisition accounting including the share-based payments and recognition of intangible assets; othe completion of the purchase price allocation (provisionally accounted for at 30 June 2020) between goodwill and intangible assets associated with BAE as Alertvale is deemed to be the acquirer in both transactions. oadoption of any changes in other financial reporting standards (if required). ENDS For further information and media assistance, please contact: Troy Donovan Chief Financial Officer and Company Secretary SMW Group Limited Email: troy.donovan@smwgroup.com.au End CA:00364026 For:SMW Type:FLLYR Time:2020-11-26 14:26:16