Announcement PDF Carbonxt Group Limited Appendix 4E Preliminary final report 1. Company details Name of entity: Carbonxt Group Limited ABN: 59 097 247 464 Reporting period: For the year ended 30 June 2026 Previous period: For the year ended 30 June 2025 2. Results for announcement to the market $'000 Revenues from ordinary activities down 3.1% to 15,694 Underlying Earnings Before Interest, Tax, Depreciation and Amortisation ('EBITDA') up 123.9% to (1,041) Loss from ordinary activities after tax attributable to the owners of Carbonxt Group Limited down 31.5% to (4,629) Loss for the year attributable to the owners of Carbonxt Group Limited down 31.5% to (4,629) Dividends There were no dividends paid, recommended or declared during the current financial period. Comments The loss for the Group after providing for income tax amounted to $4,629,000 (30 June 2025: loss for the Group of $6,761,000). The decrease in loss for the Group compared to prior year is primarily due to the gain on remeasurement of royalty payables of $2,262,000. Revenues decreased 3.1% compared to prior year primarily due to the lower foreign exchange rate of Australian Dollar against US Dollar. Carbonxt Group Limited Appendix 4E Preliminary final report The directors consider Underlying Earnings Before Interest, Tax, Depreciation and Amortisation (‘EBITDA’) and Underlying EBIT to reflect the core earnings of the Group. Underlying EBITDA and underlying EBIT are financial measures which are not prescribed by Australian Accounting Standards (‘AAS’) and represent the profit or loss under AAS adjusted for non-cash and significant items. The following table summarises key reconciling items between statutory loss after income tax and underlying EBITDA for the current and previous year period: Consolidated 2026 2025 $'000 $'000 Revenue 15,694 16,195 Gross margin 7,422 8,481 Other income 150 269 Shipping and distribution costs (1,970) (1,984) Operating expenses (6,643) (7,231) Underlying EBITDA (1,041) (465) Depreciation and amortisation (1,870) (2,275) Underlying Earnings before interest and tax ('EBIT') (2,911) (2,740) Net Interest expense (4,639) (3,335) Share-based payment expense (74) (104) Fair value movement on embedded derivatives 733 - Net remeasurement (loss)/gain on royalty payables 2,262 (582) Loss before income tax expense (4,629) (6,761) For further commentary refer to 'Review of operations' section within the Directors' report of the Annual Report and the attached market announcement. 3. Net tangible assets Reporting period Previous period Cents Cents Net tangible assets per ordinary security (1.51) (0.55) The net tangible assets calculation does not include rights-of-use assets of $7,532,000 (30 June 2025: $6,230,000) but include the lease liabilities of $2,509,000 (30 June 2025: $1,264,000). 4. Control gained over entities Not applicable. 5. Loss of control over entities Not applicable. 6. Dividends Current period There were no dividends paid, recommended or declared during the current financial period. Carbonxt Group Limited Appendix 4E Preliminary final report Previous period There were no dividends paid, recommended or declared during the previous financial period. 7. Dividend reinvestment plans Not applicable. 8. Details of associates and joint venture entities Reporting entity's percentage holding Contribution to profit/(loss) (where material) Reporting period Previous period Reporting period Previous period Name of associate / joint venture % % $'000 $'000 NewCarbon Processing, LLC 48.05% 43.66% - - Group's aggregate share of associates and joint venture entities' profit/(loss) (where material) Profit/(loss) from ordinary activities before income tax - - Income tax on operating activities - - 9. Foreign entities Details of origin of accounting standards used in compiling the report: Not applicable. 10. Audit qualification or review Details of audit/review dispute or qualification (if any): The financial statements have been audited and an unqualified opinion has been issued with a paragraph addressing material uncertainty related to going concern. 11. Attachments Details of attachments (if any): The Annual Report of Carbonxt Group Limited for the year ended 30 June 2026 is attached. Carbonxt Group Limited Appendix 4E Preliminary final report 12. Signed As authorised by the Board of Directors Signed ___________________________ Date: 31 August 2026 Warren Murphy Managing Director Sydney Carbonxt Group Limited ABN 59 097 247 464 Annual Report - 30 June 2026 Carbonxt Group Limited Contents 30 June 2026 1 Corporate directory 2 Chairman's letter 3 Directors' report 6 Auditor's independence declaration 21 Consolidated statement of profit or loss and other comprehensive income 22 Consolidated statement of financial position 23 Consolidated statement of changes in equity 24 Consolidated statement of cash flows 25 Notes to the consolidated financial statements 26 Consolidated entity disclosure statement 62 Directors' declaration 63 Independent auditor's report to the members of Carbonxt Group Limited 64 Shareholder information 70 Carbonxt Group Limited Corporate directory 30 June 2026 2 Directors Matthew Driscoll - Chairman Warren Murphy - Managing Director David Mazyck - Director of Technology Nicholas Andrews – Non-Executive Director Company secretary Laura Newell Registered office Level 8, 210 George Street Sydney NSW 2000 Australia Tel: +61 2 8072 8271 Principal place of business Suite 111 3951 NW 48th Terrace Gainesville FL 32606 United States of America Share register Boardroom Pty Limited Level 8, 210 George Street Sydney NSW 2000 Australia Tel: +61 2 9290 9600 Auditor Ernst & Young 200 George Street Sydney NSW 2000 Australia Solicitors Thomson Geer Level 14 60 Martin Place Sydney NSW 2000 Australia Stock exchange listing Carbonxt Group Limited shares are listed on the Australian Securities Exchange (ASX code: CG1) Website www.cglimited.com.au Corporate Governance Statement The directors and management are committed to conducting the business of Carbonxt Group Limited in an ethical manner and in accordance with the highest standards of corporate governance. Carbonxt Group Limited has adopted and has substantially complied with the ASX Corporate Governance Principles and Recommendations (Fourth Edition) ('Recommendations') to the extent appropriate to the size and nature of its operations. The Group’s Corporate Governance Statement, which sets out the corporate governance practices that were in operation during the financial year and identifies and explains any Recommendations that have not been followed, and ASX Appendix 4G are released to the ASX on the same day the Annual Report is released. The Corporate Governance Statement and Corporate Governance Compliance Manual can be found on the Company’s website at www.cglimited.com.au Carbonxt Group Limited Chairman's letter 30 June 2026 3 Dear Shareholders, FY26 has been a year of real and measurable progress for Carbonxt. Our established operations delivered positive operating cash flow across the full year on gross margins of approximately 50%; we secured significant new commercial contracts that underpin FY27 revenue growth, and, subsequent to the end of the reporting period, we agreed to a two-stage restructuring of the Company’s balance sheet with our two largest financial stakeholders. As at the date of this letter, the Kentucky facility is in the final stages of kiln finalisation and commissioning has recommenced. Kentucky has taken longer to bring online than we anticipated at the start of the year, caused by an equipment issue that is being resolved with the full support of the kiln manufacturer. The Company enters FY27 in a materially stronger position than a year ago: existing operations substantially improved, with an agreed pathway to lower senior debt subject to the conditions set out below, and with our flagship growth asset close to first production. Kentucky – Approaching Commercial Production Our Kentucky activated carbon facility, developed alongside our partners at Kentucky Carbon Processing, LLC through our jointly owned company New Carbon Processing, LLC, progressed substantially during FY26. Construction of the kiln was completed, refractory lining installed and heat treatment undertaken. The back-end infrastructure, bagging station, conveyors, additional storage silos, and the onsite power station were installed and brought online. All outside works are now complete. We had targeted first revenues from the facility in early calendar 2026 and have not met that timetable. As the plant moved into early commissioning, remediation requirements were identified in the kiln, and further inspection established that the affected equipment needed to be replaced rather than repaired. The kiln manufacturer agreed to replace the equipment at their cost and facilitate the repairs and has remained constructive and supportive throughout. Replacement parts began arriving during the June quarter. Subsequent to the end of the reporting period, kiln finalisation has continued and is nearing finalisation. Identifying and correcting these issues before sustained production begins is the right outcome for the plant's long-term reliability. We continued to build our position in the project throughout the year, lifting our interest in New Carbon Processing from 43.7% at 30 June 2025 to 48.1% at 30 June 2026. Two further incremental investments of US$250,000 each, made subsequent to year-end, have since taken our interest to 49.4%, bringing us closer to our stated 50% objective. Once operational, and on the basis of current internal estimates, the facility is expected to increase group sales by approximately 200% over two years and take Carbonxt into the liquid-phase activated carbon market, a segment several times larger than our current air-phase focus, with a corresponding uplift in both revenue and margin. Operational Performance and Commercial Momentum The underlying business showed further improvements over FY25. Full-year customer receipts were A$16.99 million and net operating cash flow was positive at A$492,000. Gross margins were strong at 52.4% in the June quarter, with the full year at approximately 47%. Activated Carbon Pellet (ACP) volumes recovered strongly in the second half following a planned maintenance outage at our Black Birch plant, with June quarter sales 37% higher than the March quarter. Powdered Activated Carbon (PAC) sales rose 10% over the same period as volumes from our largest PAC customer returned to prior levels. Capacity utilisation was around 57.3% of maximum capacity at Arden Hills and 73% at Black Birch. Carbonxt Group Limited Chairman's letter 30 June 2026 4 Three commercial developments during the year position us well for FY27: • A three-year extension of one of our principal ACP customer contracts on higher pricing and improved payment terms, with expected annual revenue from that contract increasing by over 30%. That customer has indicated an intention to increase volumes, which if realised would be worth approximately A$2.0 million of additional revenue in FY27. • A first purchase order from a new customer for a new ACP product entering a new market segment. The product performed well and was well received, and, as at the date of this letter, discussions to finalise a long-term supply agreement are advancing. • Agreement to relocate our Minnesota pellet operations to a new site, reducing monthly operating costs by over US$10,000 and enabling future expansion at a much lower cost. The move is expected to complete in the September 2026 quarter, after the end of the reporting period. PAC volumes continue to be underpinned by long-term contracts with ReWorld and Wisconsin Public Service, providing a stable base of contracted revenue. Balance Sheet Restructuring Agreed After the End of the Reporting Period Shortly after year-end, on 3 July 2026, we agreed to a two-stage balance sheet restructuring with our two largest financial stakeholders - Phelbe Pty Ltd, our major shareholder and noteholder, and Pure Asset Management, our senior lender - designed to substantially strengthen the Company’s balance sheet as Kentucky enters commercial production. The agreement was reached after the end of the reporting period and is not reflected in the FY26 financial statements. Refer to Note 36 Events after the reporting period. Stage 1 completed on 3 July 2026, comprising A$3.5 million of new convertible notes: A$2.0 million of new cash from Phelbe and A$1.5 million from Pure set off against senior debt and accrued interest. Pure has also agreed to provide any required covenant waivers to 31 December 2026 i.e. the next covenant test date is 31 December 2026. Stage 2 is conditional on (a) shareholder approval at an Extraordinary General Meeting expected in September 2026 (b) the Company’s share price closing at or above $0.09 for five consecutive trading days before 31 December 2026 (c) on the commencement of Kentucky operations (defined as receipt of an independent engineer certification attesting to the plant being operational, together with the achievement of US$1 million in initial revenue from the facility) and (d) no material adverse effect. On satisfaction of those conditions, Phelbe will convert existing notes and exercise options, and Pure will exercise its warrants and options. Pure's proceeds of approximately A$5.0 million will be applied directly to reduce the senior facility from A$15.0 million to approximately A$10.0 million, with all financial covenants removed for the remaining life of that loan, which matures on 31 May 2027. In aggregate, the plan, if both stages complete, would deliver a cash injection of up to A$11 million and a net reduction in debt of approximately A$5 million, while simplifying the Company’s capital structure. Every conversion and exercise price sits above the A$0.068 share price on 6 July 2026, being the date of the agreement. That both parties are committing capital at prices above the market is a clear and welcome expression of confidence in Carbonxt’s strategy and in the value of the Kentucky investment. Strategic Positioning – Ongoing Regulatory and Market Tailwinds The regulatory case for our products was maintained during FY26. In May 2026, the US EPA proposed a rule that upholds the Maximum Contaminant Levels for PFOA and PFOS at 4 parts per trillion, together with an application- based two-year extension of the compliance deadline to April 2031 that gives utilities more time to plan, fund and deploy treatment infrastructure. In the same package the EPA proposed to rescind the drinking water regulations for PFHxS, PFNA, GenX and the related Hazard Index mixture. Neither rule is final. The PFOA and PFOS standards that drive our addressable market are unchanged. The EPA released nearly US$1 billion in new grant funding to states to address PFAS in drinking water, bringing that programme to US$5 billion over five years, alongside US$4 billion through the Drinking Water State Revolving Funds and more than US$6.5 billion in low-interest financing. In June, the EPA signed the proposed Sixth Unregulated Contaminant Monitoring Rule, which was published in the Federal Register on 1 July 2026, widening the occurrence-monitoring net that drives future regulation. On 24 June Carbonxt Group Limited Chairman's letter 30 June 2026 5 2026, the Department of Justice, the EPA and the West Virginia Department of Environmental Protection announced a proposed US$450 million settlement with Chemours, the first comprehensive federal enforcement settlement with a PFAS manufacturer. That settlement is a proposed consent decree and remains subject to court approval. The standards that drive procurement in our addressable market remain in place, the proposed compliance timetable now extends to 2031, and the capital to meet those standards is flowing. Activated carbon, and powdered and granular activated carbon in particular, remains the most widely adopted treatment technology for PFOA and PFOS removal at scale. Combined with a projected 5–9% compound annual growth rate in activated carbon demand through 2030, these trends support a long and visible growth runway for Carbonxt. Outlook for FY 27 An operational base that generated positive operating cashflow during FY26, a restructured balance sheet and Kentucky approaching first production, FY27 is set to be a defining year. Our priorities are: • Completing Kentucky commissioning, achieving the initial revenue milestone and entering the liquid-phase market. • Completing Stage 2 of the restructuring, reducing senior debt to approximately A$10 million and removing all financial covenants. • Converting the new ACP purchase order into a long-term supply agreement and delivering the volume growth indicated by our existing customers. • Completing the Minnesota relocation and maintaining the operational discipline that delivered positive operating cash flow in FY26. On behalf of the Board, I would like to thank our shareholders for their continued support and for their patience as Kentucky has worked through to completion, our lenders and noteholders at Pure Asset Management and Phelbe Pty Ltd for their substantial and constructive partnership through the restructuring, and most importantly our employees, whose expertise and dedication delivered the operational recovery and new business wins that defined the year. FY26 has put the pieces in place for a step change in the scale of this business, and we look forward to updating you as we deliver on the opportunities ahead. Yours sincerely, Matthew Driscoll Chairman 31 August 2026 Carbonxt Group Limited Directors' report 30 June 2026 6 The directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter as the 'Group') consisting of Carbonxt Group Limited (referred to hereafter as the 'Company' or 'parent entity') and the entities it controlled at the end of, or during, the year ended 30 June 2026. Directors The following persons were directors of Carbonxt Group Limited during the whole of the financial year and up to the date of this report, unless otherwise stated: Matthew Driscoll - Chairman Warren Murphy David Mazyck Nicholas Andrews Imtiaz Kathawalla (resigned 02 July 2025) Principal activities During the financial year the principal continuing activities of the Group consisted of the development and sale of specialised Activated Carbon ('AC') products, including Powdered Activated Carbon ('PAC') and AC pellets for the removal of pollutants and toxins in industrial processes. These products are used in industrial air purification, waste water treatment and other liquid and gas phase markets, primarily for the capture of mercury and sulphur in order to reduce harmful emissions into the atmosphere, as required by global regulations. Dividends There were no dividends paid, recommended or declared during the current or previous financial year. Review of operations The loss for the Group after providing for income tax amounted to $4,629,000 (30 June 2025: $6,761,000). The decrease in loss for the Group compared to prior year is primarily due to the gain on remeasurement of royalty payables of $2,262,000. Revenue for the year was $15,694,000 (before other income) and $15,844,000 (after other income) representing a decrease of 3.1% and 3.8% respectively on the prior year's revenue of $16,195,000 (before other income) and $16,464,000 (after other income). In US dollars, revenue was US$10,649,000 (before other income) and US$10,750,000 (after other income) representing an increase of 1.4% and 0.7% respectively on the prior year’s revenue of US$10,498,000 (before other income) and US$10,672,000 (after other income). Revenues decreased 3.1% compared to prior year primarily due to the lower foreign exchange rate of Australian Dollar against US Dollar. Carbonxt Group Limited Directors' report 30 June 2026 7 The directors consider Underlying Earnings Before Interest, Tax, Depreciation and Amortisation (‘EBITDA’) and Underlying EBIT to reflect the core earnings of the Group. Underlying EBITDA and underlying EBIT are financial measures which are not prescribed by Australian Accounting Standards (‘AAS’) and represent the profit or loss under AAS adjusted for non-cash and significant items. The following table summarises key reconciling items between statutory loss after income tax and underlying EBITDA for the current and previous year period: Consolidated 2026 2025 $'000 $'000 Revenue 15,694 16,195 Gross margin 7,422 8,481 Other income 150 269 Shipping and distribution costs (1,970) (1,984) Operating expenses (6,643) (7,231) Underlying EBITDA (1,041) (465) Depreciation and amortisation (1,870) (2,275) Underlying Earnings before interest and tax ('EBIT') (2,911) (2,740) Net Interest expense (4,639) (3,335) Share-based payment expense (74) (104) Net remeasurement (loss)/gain on royalty payables 2,262 (582) Fair value movement on embedded derivatives 733 - Loss before income tax expense (4,629) (6,761) Liquidity During the financial year ended 30 June 2026, the Group incurred a net loss after tax of $4,629,000 (30 June 2025: $6,761,000) and a cash inflow from operating activities of $492,000 (30 June 2025: outflow of $4,752,000). As at 30 June 2026, the Group had net assets of $5,645,000 (30 June 2025: $9,223,000), net current liability of $22,004,000 (30 June 2025: $15,120,000) and cash and cash equivalents of $553,000 (30 June 2025: $481,000). As a result of the loss incurred for the year ended 30 June 2026 and the liquidity at the reporting date, there is a material uncertainty on whether the Group can continue as a going concern. The directors consider that the Group will continue as a going concern, as explained in note 2 to the financial statements. Business risks The following is a summary of material business risks that could adversely affect the Group's financial performance and growth potential in future years and how the Group proposes to mitigate such risks: Climate Risk The Group takes climate risk into account in its investment decisions. There is the possibility that such decisions have underestimated the severity of climate change. The bio-char input at Black Birch is a renewable source and has a lower footprint than most Activated Carbon manufacturing facilities, but it is feasible that climate change affects the availability of the input source. Construction Risk The NewCarbon investment is in construction phase. As with all construction activities there is the possibility of delays to completion or issues during the start-up phase. Given the plant has operated for a number of years as a waste-to- energy plant that start-up risk is reduced, compared to a greenfields construction site, but nevertheless there is a potential for construction issues. Competition risk The Group operates in a dynamic AC market. There is a possibility that existing or new competitors may increase competitive pressure through technological advancements, volume increases or pricing and other strategies. Any significant advancements in technology for producing AC have the potential to change the competitive environment in which the Group operates. Carbonxt Group Limited Directors' report 30 June 2026 8 Ability to retain existing clients or attract new clients The Group’s business depends on its ability to retain contracts with existing customers and to attract further business from existing customers or attract new customers. The loss of existing customers or the inability to attract new customers would have an adverse impact on the financial position of the Group. Regulatory risk The Group is heavily reliant on US environmental policies and regulation. Any change to or reversal of current legislation would have a significant negative effect on the Group’s business model and financial performance. Intellectual property risk The Group relies on its intellectual property (including technology, know how, trademarks, designs and patents) and there can be no assurance that competitors or other parties will not imitate or develop technology and know-how that challenges or competes with the Group or supersedes the Group’s intellectual property. In addition, any unauthorised use or disclosure of the Group’s intellectual property may also have an adverse effect on the Group's financial performance. Reliance on key personnel The Group employs, or engages as consultants, a number of key management and scientific personnel. The inability of the Group to retain and attract highly qualified and experienced personnel could have a material adverse impact on the Group’s business and financial performance. Safety and industrial accidents The manufacture and supply of the Group’s products are subject to safety related risks, which are managed carefully by the Group. Despite the relevant safety guards there is no guarantee a serious accident will not occur in the future, which may negatively affect the financial performance of the Group. Brand establishment and maintenance Establishing and maintaining its brand in the industry is critical to growing the Group’s customer base and product acceptance. Prior to entering into supply agreements, the Group is required to undertake vigorous testing of its Activated Carbon solutions. Any unsuccessful tests for potential customers could adversely affect the Group’s brand, and its business and operating results could be adversely affected. The Group must also maintain and support its existing customer relationships to maintain its brand and attract further customers. Offshore operations While the Group’s corporate management is in Australia, its operations are based in the United States. The global nature of the pollution control business may result in the Group's activities extending to other countries in the future. Geographic diversity adds risk to the ability of the Group to manage its operations and employees, and introduces additional risks relating to the general economic, regulatory, legal, social and political environment in the jurisdictions in which it intends to operate, which may in turn adversely affect the Group's business and financial condition. Exchange rate risk The Group is exposed to movements in exchange rates as the vast majority of the Group's revenue and expenses are denominated in USD. Adverse movements in the AUD/USD exchange rate may have an adverse effect on the reported financial performance and/or financial position of the Group. Product liability and uninsured risks The Group is exposed to potential product liability risks, which are inherent in the research and development, manufacturing, marketing and use of its products or products that are developed in the future. Whilst the Group has liability insurance to help manage such risks, the Group may not be able to maintain insurance for product or service liability on reasonable terms in the future and/or the Group’s insurance may not be sufficient to cover large claims, or the insurer could disclaim coverage on any such claims. Concentration risk The Group has significant dependence on a limited number of customers. The loss of a major customer could materially affect revenue, operations, profitability, and cash flow. Management continuously monitors concentration exposures and seeks to mitigate these risks through customer diversification, expansion into new markets, and ongoing assessment of key business relationships. Carbonxt Group Limited Directors' report 30 June 2026 9 Significant changes in the state of affairs Capital raising On 17 October 2025, the Company announced the completion of the share placement of 8,000,000 fully paid shares at $0.075 per share before issue costs. On 6 January 2026, the Company issued 6,666,667 ordinary shares at $0.09 per share raising $600,000 before issue costs. Loyalty Option On 22 August 2025, the Company announced a non-renounceable pro-rata entitlement offer to Eligible Shareholders of one (1) Option to acquire a fully paid ordinary share in the Company ('Loyalty Option') for every six (6) shares held by shareholders registered at 7.00pm (AEST) on 27 August 2025 ('Record Date') at an issue price of $0.01 and exercise price of $0.07 per Loyalty Option ('Entitlement Offer'). The Offer was fully underwritten by Chaleyer Holdings Pty Ltd, an existing shareholder of the Company. A total of 58,776,787 options were issued, raising a total of $587,769 before issue costs. On 26 September 2025, the Company issued 8,000,000 Loyalty Option to the directors at an issue price of $0.01 in lieu of compensation totalling to $80,000. Investment in NewCarbon The contributions to NewCarbon for the year totalled to US$1,500,000 (30 June 2025: US$2,250,000) which increased the ownership in NewCarbon to 48.05% as at 30 June 2026 (30 June 2025: 43.66%). Convertible notes On 25 September 2025, the Company issued additional 400,000 convertible notes with a face value of $1 exercisable at $0.08 and expiring on 17 October 2027. The convertible notes will convert to a total of 5,000,000 ordinary shares. The convertible note has 1 attaching option with every 1 share issued to the noteholders upon conversion. On 18 February 2026, the Company issued additional 500,000 convertible notes with a face value of $1 exercisable at $0.10 and expiring on 18 February 2029. The convertible notes will convert to a total of 5,000,000 ordinary shares. The convertible note has 1 attaching option with every 3 shares issued to the noteholders upon conversion. On 9 April 2026, the Company issued additional 750,000 convertible notes with a face value of $1 exercisable at $0.10 and expiring on 9 April 2029. The convertible notes will convert to a total of 7,500,000 ordinary shares. The convertible note has 1 attaching option with every 3 shares issued to the noteholders upon conversion. There were no other significant changes in the state of a