RHI Magnesita

Our business model and value chain

We are masters of heat, the leading global supplier of high-grade refractory products, systems and solutions. We have a vertically integrated value chain ranging from raw material sourcing to refractory production and performance-based solutions.

Our purpose: to master heat, enabling global industries to build sustainable modern life. We offer refractory products and services that shape tomorrow's world. Our advanced products are essential for our customers in the steel, cement, metals, glass and chemicals industries.

Value chain activities:

• Raw materials: RHI Magnesita operates raw material sites in Austria, Brazil, China, Czechia, Türkiye and USA. 67% of magnesite and dolomite raw material usage by volume was sourced internally in 2024, contributing 0.8% to Group Adjusted EBITA margin.
• Refractory production: The Group operates 53 refractory production plants in Europe, Türkiye, India, China and the Americas.
• Logistics: Timely raw material and finished goods deliveries with effective inventory management strategies.
• Research & Development: Development of new products, customisation and improved production techniques. R&D is essential to maintaining our position as market leader and achieving longer-term sustainability objectives.
• Services: Design, installation, monitoring, maintenance, optimisation, removal and recycling of refractory solutions.

Business model evolution - 4PRO: A comprehensive offering that reflects our expanded capabilities including sustainable products, robotics, systems, sensors, digital solutions, decarbonisation solutions and clean and green steel solutions. 80% of customers are interested in the 4PRO offering when made aware of it.

Stakeholder engagement

RHI Magnesita engages with key stakeholder groups through various channels:

Shareholders: Regular engagement via one-on-one meetings, investor presentations, AGM, industry conferences. Priority topics include company strategy, operational performance, geopolitical outlook, sustainability agenda, climate strategy.

Customers: Day-to-day contact, technical consulting, customer satisfaction surveys with Net Promoter Score as key metric. The Board meets customers during site visits. Priority topics include service levels, climate change opportunities, health & safety.

Employees: Communication through townhall meetings, Workvivo app, Culture Champions network. Board engages through Employee Representative Directors and plant visits. Priority topics include operational performance, health & safety, business restructuring, salary growth, work/life balance.

Communities: Member of UN Global Compact supporting UN SDGs. Local engagement at operational level. Focus areas include education, health and medical care, environment. Community investment increased in 2024.

Governments and authorities: Ongoing dialogue with government agencies. Hosted Director General from EU Commission at Breitenau mine. Key discussions on raw materials, sustainability, infrastructure.

ESRS Coverage: RHI Magnesita has produced a Sustainability Statement according to ESRS for the 2024 financial year. Having completed a lengthy double materiality assessment and complied in full with the disclosure requirements, the Group notes that the ESRS process places an unreasonable burden in terms of financial cost and other corporate resources. The Group is of the view that the outcome of the ESRS process is not beneficial to stakeholders and urges relevant regulators to look again at the implementation.

The European Commission has proposed a revision to ESRS through its Omnibus Directive and the Group hopes for improvement. The specific ESRS topics covered would be detailed in the Sustainability Statement (pages 64-172).

CO2 emissions: Total CO2 emissions (Scope 1, 2 and 3 - raw materials) were 4.4 million tonnes in 2024. Emissions intensity was 1.57 t CO2/t product in 2024, compared to 1.62 t CO2/t in 2023. Since the baseline year of 2018, emissions intensity has reduced by 14%. Detailed GHG emissions data would be in the Sustainability Statement (pages 64-172).

Internal carbon pricing: Our production process is CO2 intensive and plants in Europe are required to purchase CO2 certificates. The cost was €6 million in 2024 (2023: €2 million). Average price per tonne was €59.30. RHI Magnesita operates a hedging strategy for future CO2 costs. Further details would be in the Sustainability Statement (pages 64-172).

Actions related to circular economy include: Recycling rate of 14.2% achieved in 2024, up from 12.6% in 2023. Target of 15% by 2025 and 20% by 2030. Acquisition of Refrattari Trezzi to expand European recycling activities. Launch of new 'RAPTOR' waste sorting unit utilizing automated sorting technologies. 1.6t of CO2 can be saved per tonne of recycled raw material used. Further details would be in the Sustainability Statement (pages 64-172).

Circular economy targets: 15% secondary raw material content by 2025, 20% by 2030. Further details would be in the Sustainability Statement (pages 64-172).

Workforce engagement processes include townhall meetings, Workvivo communications app, Culture Champions network, quarterly global webinars, and Employee Representative Directors on the Board. Further details would be in the Sustainability Statement (pages 64-172).

Workforce targets include 33% female representation in senior leadership by 2025 (currently 26%). Further details would be in the Sustainability Statement (pages 64-172).

Employee characteristics data would be contained in the Sustainability Statement (pages 64-172). However, the company notes employees from over 90 countries and voluntary turnover of 5.21% in 2024.

Gender diversity metrics:

• Board gender diversity: 33% in 2024 (2023: 29%)
• Senior leadership gender diversity: 26% in 2024 (2023: 28%)
• Target: 33% female representation in senior leadership by 2025

Further diversity metrics would be in the Sustainability Statement (pages 64-172).

Health and safety metrics:

• Lost Time Injury Frequency (LTIF): 0.11 in 2024, down from 0.16 in 2023 (31% reduction)
• Total Recordable Injury Frequency (TRIF): 0.41 in 2024, down from 0.46 in 2023
• Two fatalities occurred in 2024 - one at Breitenau plant in Austria and one at Dalian plant in China

Full health and safety metrics would be in the Sustainability Statement (pages 64-172).

Community policies would be contained in the Sustainability Statement (pages 64-172). However, the company is a member of UN Global Compact supporting UN SDGs with focus on education, health and medical care, and environment.

Community engagement processes include local engagement at operational level, employee volunteering programme with six non-profit organisations. Further details in Sustainability Statement (pages 64-172).

Business conduct policies would be contained in the Sustainability Statement (pages 64-172). However, the company has a Code of Conduct with zero-tolerance approach to illegality. Corporate culture is built on four values: innovation, openness, pragmatism and performance.

Political influence and lobbying activities include hosting 'Magnesia Cocktail' networking event in Brussels, engaging with EU Commission Director General, discussions with government representatives from various countries. Further details would be in the Sustainability Statement (pages 64-172).