Press Metal Annual Report 2024

Press Metal Aluminium Holdings Berhad SECTION 3 • CHARTING THE PATHWAY TOWARDS EXCELLENCE 24 Outlook for 2025 The IEA forecasted that global renewable energy capacity will expand by more than 5,500 GW between 2024 and 2030, nearly tripling the increase seen from 2017 to 2023. Solar energy is expected to represent 80% of the growth in global renewable capacity during this period, presenting significant opportunities for the aluminium industry, as aluminium makes up over 85% of most solar photovoltaic components. Additionally, the continued rise in EV adoption is set to drive further demand, with sales expected to grow by an average of 21% annually over the next four (4) years16,17. Our shift towards greener industries necessitates progress in decarbonising our operations. To meet our goal of net-zero emissions by 2050, we remain focused on adopting cleaner technologies, increasing aluminium recycling rates, and improving energy efficiency across our operations. Moreover, as the regulatory landscape in Malaysia and China evolve, we are committed to implementing the necessary measures to ensure full compliance with emerging regulations. Transition to a Low-Carbon Economy The Market We Operate In Global Megatrend The World Meteorological Organisation has confirmed that 2024 was the warmest year on record, with global temperatures in certain geographical areas surpassing 1.5°C above pre-industrial levels for the first time9. This highlighted the urgent need for governments and organisations to accelerate decarbonisation efforts and transition from fossil fuels to renewable energy sources, in line with the Paris Agreement’s goal of limiting long-term temperature rise to 1.5°C. In response, the International Energy Agency (“IEA”) projected global energy investments is expected to exceed USD3 trillion in 2024, with USD2 trillion allocated to clean energy technologies and infrastructure10. The growing urgency for action has created new opportunities for the aluminium industry, as aluminium is a key material in green technologies. Its lightweight properties, high strength-to-weight ratio, and excellent conductivity make it essential for sectors such as renewable energy. However, aluminium production is highly carbon-intensive, contributing over 1.1 billion tonnes of CO2e annually as about 60% of global primary aluminium smelting relies on non-renewable energy sources, with coal being the largest contributor. To align with the Paris Agreement’s goals, the industry must reduce its GHG emissions to 0.8 billion tonnes by 2030 and 53 million tonnes by 205011. Aluminium’s role in green industries is set to expand, driven by the growth of renewable energy infrastructure and EVs. Aluminium is crucial in solar photovoltaic components, making up over 85% of the material in most installations. As solar energy capacity continues to increase, global demand for aluminium is expected to rise by 160 million tonnes by 205012. On the transportation front, the IEA projected the total fleet of EVs to grow to about 250 million in 2030, from less than 45 million in 2023. The aluminium content in EVs is also projected to grow to 350 kg per vehicle by 2030, a significant increase from 190 kg in 202013,14. Additionally, aluminium’s recyclability — requiring up to 95% less energy to produce than primary production — has led to a rise in secondary aluminium production, with scrap recycling rates at an all-time high. Global initiatives such as the COP29 Global Energy Storage and Grids Pledge, launched in Baku, Azerbaijan, are further boosting demand for aluminium. The pledge aimed for a sixfold increase in energy storage capacity by 2030, which called for stronger and more transparent supply chains to support resilient renewable energy grids15. With aluminium playing a key role in energy storage and transmission, the demand for the material is expected to grow in tandem with global efforts to expand grid infrastructure and accelerate clean energy adoption. In line with these trends, China, which produces over half of the world’s aluminium, has taken significant steps to reduce emissions from its aluminium sector. By 2025, China aims for 30% of its aluminium capacity to meet efficiency benchmarks, with 25% of energy coming from renewable sources and recycled aluminium output to reach 11.5 million tonnes. Meanwhile, Malaysia has committed to a 45% reduction in carbon intensity by 2030, relative to 2005 levels, with the introduction of the Energy Efficiency and Conservation Act (“EECA”) 2024. This legislation aims to improve energy efficiency across various sectors, with Sabah and Sarawak also planning to develop their own energy efficiency regulations. Impact on Business Operations • Our smelting operations are powered predominantly by hydroelectric energy, positioning us as a producer of low-carbon aluminium. This provides a competitive advantage as both consumers and investors increasingly prioritise climate-conscious solutions. • The growing adoption of solar energy and the expansion of EVs present significant opportunities, with aluminium demand projected to rise substantially over the coming decades. • As an integrated aluminium producer in SEA, we are well-positioned to benefit from the potential relocation of EV manufacturing facilities to the region, aligning with the evolving supply chain ecosystem. • Through our commitment to low-carbon aluminium solutions and an efficient cost model, we aim to further strengthen our market position, broaden our geographical footprint, and optimise our large-scale production capabilities.

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