FRONTKEN CORPORATION BERHAD 200401012517 (651020-T) ANNUAL REPORT 2025 39 The following climate-related financial disclosures are provided in accordance with IFRS S2 cross-industry metric requirements. These figures should be read in conjunction with Note 11 to the Audited Financial Statements for the financial year ended 31 December 2025. A. Climate-Related Capital Expenditure Item (RM’000) FY2025 Total Group capital expenditure of which: renewable energy and solar PV installations of which: energy efficiency upgrades of which: waste treatment and environmental compliance facilities 42,743 Nil 1,724 147 Total climate-related capital expenditure 1,871 Climate capex as % of total Group capex 4.4% Notes to Table A: (1) Renewable energy and solar PV installations: No new solar PV capital assets were commissioned in FY2025. Ongoing solar generation from existing installations is reflected in energy consumption and eco-efficiency data in Section 5.4; the carrying value of existing solar assets is included in the Kaohsiung facility fixed assets disclosed in Table B. (2) Waste treatment and environmental compliance facilities: RM147,000 relates to upgrades to waste treatment facilities and low-GWP refrigerant replacement programmes. (3) Energy efficiency upgrades: RM1,724,000 covers chiller system upgrades, scrubber overhaul and energy-optimisation projects. (4) A FY2024 comparative column is not presented for Table A as this is the first year of IFRS S2 application and the transition relief on comparative financial disclosures has been applied (see Section 1.3). B. Carrying Value of Assets Exposed to Material Climate Risks Asset Category (RM’000 carrying value) FY2025 As % of Group Fixed Assets Transition risk — Taiwan operations (carbon pricing under Climate Change Response Act) - 0% Physical risk — Tainan and Kaohsiung, Taiwan facility (flood and drought exposure) 4,912 2% (estimated) Notes to Table B: Disclosure policy: (1) Transition risk — Taiwan operations: Taiwan operations account for approximately 75% of Group revenue. The aggregate carrying value of property, plant and equipment (“PPE”) located in Taiwan (which represents the primary transition-risk-exposed asset base under the Climate Change Response Act carbon pricing regime) is disclosed in Note 11 to the Audited Financial Statements for the financial year ended 31 December 2025. Frontken will implement climate-risk tagging of individual asset categories in its fixed asset register from FY2026 to enable disaggregated disclosure. (2) Physical risk — Tainan and Kaohsiung facility: The Tainan and Kaohsiung, Taiwan facility is identified as the primary physical risk exposure (flood and drought). Its carrying value of RM4,912,000 is included within the Taiwan PPE balance in Note 11 and represents approximately 2% of total Group fixed assets based on management assessment. No separate impairment has been recognised in FY2025 as no physical climate event occurred and no indicators of impairment were identified. Frontken will separately track carrying values of facilities in flood- and drought-risk locations from FY2026. C. Liabilities Arising from Climate-Related Risks Liability Type (RM’000) FY2025 Carbon tax / carbon fee obligations (Taiwan) 0 Climate-related provisions or contingent liabilities 0 Total climate-related liabilities 0 No carbon tax or carbon fee obligations arose in FY2025. Under Taiwan's Climate Change Response Act, the carbon fee mechanism applies above a threshold of 25,000 tCO2e per year for covered installations. Frontken's Taiwan operations did not exceed this threshold in FY2025, and accordingly no carbon fee obligation was incurred. SUSTAINABILITY REPORT (CONT’D)
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