Environmental stewardship at SAGT is embedded within the Company’s broader sustainability framework and integrated into day-to-day operational decision-making. The Company continues to adopt a proactive approach that seeks not only to minimise adverse environmental impacts, but also to identify opportunities for innovation, efficiency gains and long-term value creation. This includes improving energy productivity, modernising equipment fleets, reducing dependence on fossil fuels, strengthening waste management systems, enhancing responsible water use and supporting ecosystem conservation initiatives aligned with the Company’s operational footprint.

ENVIRONMENTAL COMPLIANCE AND RESPONSIBLE OPERATIONS

SAGT remains committed to maintaining compliance with all applicable environmental laws, regulations, licences and permit conditions. Environmental controls are embedded into routine operations, supported by monitoring, inspections, preventive maintenance and third party testing where required.

The Company’s Environmental Protection Licence requirements include ongoing monitoring of relevant emissions and environmental parameters. Internal teams work closely with qualified external specialists to ensure that testing, reporting and remediation actions are conducted to appropriate standards.

Beyond legal compliance, SAGT aims to uphold responsible operating practices that reflect stakeholder expectations and the Company’s values. No environmental grievances of fines were recorded during the reporting period, reflecting the continued effectiveness of management systems and engagement channels.

Materials Usage (GRI 301-1)

Efficient use of materials remain a central pillar of SAGT’s environmental stewardship strategy. As a high-performance container terminal operating within a dynamic logistics environment, the Company relies on specialised heavy equipment, mobile fleets, quay cranes, engineering assets and supporting infrastructure, as well as other non-renewable consumables such as lubricants, tyres, ropes and other consumables. Managing these resources efficiently is therefore essential not only from an environmental standpoint, but also for operational continuity, cost discipline and long-term competitiveness.

Non-renewable materials used by weight or volume

During the reporting period, SAGT continued to strengthen its resource productivity agenda through disciplined maintenance practices, operational optimisation, targeted technology investments and ongoing monitoring. While cargo volumes experienced a reduction during the year, the Company remained focused on ensuring that lower activity levels translated into measurable efficiency gains rather than simply reduced consumption. This approach enabled SAGT to record improvements across several key non-renewable materials.

SAGT is committed to reducing the use of non-recyclable materials across its operations and systematically applying the 3Rs principles - Reduce, Reuse, Recycle - wherever practical and feasible. The Company continues to manage material usage carefully by aligning consumption with actual operating requirements, preventive maintenance schedules and equipment condition monitoring. Digital workflows also contribute towards reductions in paper use.

All maintenance materials are utilised in accordance with original equipment manufacturer (OEM) recommendations and established engineering standards. This disciplined approach ensures reliability and safety while avoiding premature replacement or unnecessary material waste. Tyres, ropes and lubricants are replaced based on wear indicators, operating hours, tread depth, move counts and inspection outcomes rather than arbitrary time based cycles.

During the reporting period, RTG tyre consumption amounted to 21,240 kg from last year’s consumption of 24,180 kg, representing a 12% reduction compared with the previous year. This decline was primarily attributable to lower replacement requirements following tyre changes undertaken in the prior period, as well as reduced RTG utilisation associated with lower cargo volumes. RTG tyres are not ordinarily replaced annually unless required by wear levels or damage. The reduction, therefore, reflects both prudent asset management and reduced operational strain.

Prime Mover tyre usage totalled 58,880 kg from last year’s consumption of 46,320 kg, an increase of 27% year-on-year. The increase was linked to scheduled replacements based on tyre tread depth and operating wear. Prime Movers operate continuously across the terminal environment and are subject to demanding usage patterns. To mitigate avoidable tyre damage, SAGT continued to implement housekeeping improvements and yard sweeping activities, including the use of magnetic sweepers to remove metal debris that may cause punctures. Employee awareness of careful driving and safe yard practices also remained an important preventative measure.

Lubricant consumption declined from 66,439 litres to 62,877 litres, a 5% reduction from the previous year. Lubricants are consumed primarily through planned servicing and mechanical maintenance based on machine operating hours. Lower equipment utilisation during the year reduced servicing frequency requirements, thereby contributing to lower lubricant use. This demonstrates the linkage between productivity planning, equipment deployment and resource consumption.

Wire rope consumption reduced to 71,448 kg from 111,003 kg, reflecting a 36% reduction year-on-year. Rope replacement is linked to the number of operational moves completed by Quay Cranes and RTGs, in line with OEM guidance and safety protocols. Lower move counts during the year reduced replacement requirements.

Administrative paper usage increased to 2,498 kg from FY 2024/25 consumption of 2,405 kg, representing a 4% increase over the previous year. The Company continues to focus on digitalisation and process automation to reduce dependence on physical documentation. Ongoing automation of gate operations and progressive digital workflows are expected to support a longer-term downward trend in paper consumption.

Overall, SAGT’s approach to materials management reflects the principles of operational necessity, lifecycle optimisation and waste minimisation.

Energy Management and Operational Efficiency (GRI 302-1, 302-3, GRI 302-4)

SAGT recognises that resource efficiency is not achieved through energy efficient equipment replacement alone. Digitisation and automation play an increasingly important role in reducing energy utilization by enabling smarter use of existing assets and resources.

Advanced terminal operating systems, routing optimisation tools and planning technologies help minimise unnecessary yard movements, which also contribute to reducing waiting times, improving equipment utilisation and lowering fossil fuel and electricity consumption.

As automation initiatives continue to progress across gate and quayside operations, the Company expects further gains in productivity and resource efficiency. These improvements illustrate the strong linkage between operational excellence and resource efficiency.

SAGT’s operations require direct energy in the form of diesel, petrol and LPG, and indirect energy through electricity purchased from the national grid. The Company therefore places strong emphasis on improving energy efficiency, reducing dependence on fossil fuels and integrating renewable energy into its operations.

Total direct and indirect energy use continued to reflect disciplined management during the year

Petrol consumption increased to 13 GJ from 11 GJ, a 14% rise over FY 2024/25.

LPG consumption increased to 1,270 GJ from 1,141 GJ, a 11% rise over the previous year. This was mainly attributable to revised food preparation methods in the kitchen and a temporary outage affecting certain electric cooking equipment. While non-core to terminal operations, SAGT continues to monitor LPG usage and seeks efficient energy alternatives where practical.

In volumetric terms, diesel consumption totalled 4,644,529 litres, a decrease of approximately 7.9% from the previous year. Diesel usage composition shows the scale of operational dependence across major equipment categories:

Breakdown of electricity use

The 9% reduction in the consumption of electricity of the Quay Cranes corresponded with the 11% reduction in QC moves during the year, indicating stable operational efficiency despite lower throughput.

RENEWABLE ENERGY TRANSITION

A major milestone during the reporting period was the commissioning of SAGT’s 460 kWh rooftop solar system, which became operational during the year. The installation generated 391,585 kWh of electricity during the reporting period, equivalent to approximately 12.2% of electricity requirements excluding Quay Crane consumption. This investment represents a practical step toward reducing grid dependency, lowering Scope 2 emissions and enhancing long term energy resilience.

ENERGY INTENSITY

SAGT tracks energy intensity per box move as a key indicator of operational efficiency. During the year, total energy intensity stood at 0.175 GJ per box move, compared with 0.170 GJ in the previous year. This 3% increase in energy intensity reflects the Company’s ability to maintain efficiency despite changing operational volumes and activity patterns.

Fleet Efficiency and Equipment Optimisation

RTG Hybridisation Project

One of SAGT’s most impactful energy efficiency and decarbonisation initiatives has been the hybridisation of its RTG fleet. During the year:

• 28 of 31 RTGs were hybrid units
• Hybrid RTG moves increased by 9%
• Non-hybrid RTG moves decreased by 64%

RTG diesel consumption reduced by 15% year-on-year. More importantly, diesel efficiency per move improved substantially.

• Hybrid RTG diesel efficiency: 0.73 litre per move
• Non-hybrid RTG diesel efficiency: 1.77 litres per move

This equates to a 43.5% reduction in diesel consumption per move for hybrid units. Based on recorded efficiencies, the RTG hybridisation project has generated an estimated 2 million litres of fuel savings, equivalent to a 53% reduction versus conventional operations.

This initiative demonstrates how technology upgrades can simultaneously reduce emissions, fuel costs and operating risk.

Prime Movers

Prime Movers consumed 1,857,044 litres of diesel, a 8.5% reduction compared with the previous year. This was mainly due to a 7% reduction in operating hours arising from lower terminal volumes.

In addition, diesel consumption per running hour improved by 1.3%, suggesting gains from smarter routing, reduced congestion and improved yard planning through digital tools such as Navis and Prime Route.

Inter Terminal Transfer (ITT) Trucks

Diesel consumption by the ITT fleet increased by 10%, corresponding with a 19% increase in trips performed during the reporting period. This reflected the use of SAGT’s internal fleet to provide faster and more reliable customer connections. While absolute fuel use rose, the increase supported service quality and supply chain responsiveness.

Greenhouse Gas Emissions (GRI 305-1, 305-2, 305-3, 305-4, 305-5, 305-6)

The Company’s pathway toward lower-carbon operations is centred on a practical combination of technology upgrades, operational efficiency and progressive electrification. During the year, SAGT continued to advance investments in green and energy efficient technologies, recognising that decarbonisation must be pursued in ways that also preserve productivity, reliability and customer responsiveness.

During the reporting period, SAGT purchased two electric forklifts and one electric yard cab for its Health, Safety and Environment functions, expanding the operational presence of electric mobility within the terminal. In addition, the Company’s 460 kWh rooftop solar installation became operational during the year, generating an average of 44,000 kWh per month and supplying approximately 5% of the terminal’s electricity requirements, excluding quay crane consumption, contributing to renewable electricity generation to support internal consumption.

Looking ahead, the Company plans to electrify 30 Prime Mover trucks used in terminal operations, a significant initiative expected to further reduce diesel dependency over time towards enhanced decarbonisation. SAGT also continues to evaluate the acquisition of four new Ship-to-Shore cranes under a green financing framework by the end of 2027, demonstrating the alignment of future capital expenditure with sustainability objectives. This initiative will boost efficiency, enabling further improvement in Scope 2 emission intensity.

SAGT monitors and reports greenhouse gas emissions in line with recognised methodologies. The Company follows the Greenhouse Gas Protocol developed by the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD), while applying IPCC AR6 -aligned emission factors and relevant Sri Lankan grid emission factors. Emissions from CO2 , CH2 and N2 O are considered in calculations.

Carbon Footprint by Energy Type

Total Scope 1 and Scope 2 emissions during the reporting period amounted to 16,636 MTCO₂eq, representing an 10% reduction from 18,469 MTCO2 eq in the previous year.

The reduction in emissions was primarily driven by lower diesel use and lower electricity consumption, supported by operational efficiencies and renewable energy generation.

Scope 1 Emissions (Direct)

Scope 1 emissions arise mainly from combustion of diesel, petrol and LPG, as well as fugitive emissions from refrigerants and fire suppression systems. During the year Scope 1 emissions declined to 12,879 MTCO₂eq.

Diesel remains the dominant contributor to Scope 1 emissions, reflecting the nature of terminal equipment fleets. Continued electrification and hybridisation, therefore, remain key long-term levers for decarbonisation.

SAGT utilises refrigerant gases in the Company’s air conditioning units. In the 2025/26, SAGT’s refrigerant gas usage resulted in total emissions of 323 MTCO₂eq, based on the global warming potential (GWP) of each refrigerant type. This is a 50% reduction in comparison to the previous year. During the reporting period, SAGT utilised 54 kg of R-22 refrigerant which recorded 3kg of Ozone Depleting Substances in R11 equivalent, arising from the use of R22 refrigerant gas in air-conditioning.

Carbon Footprint of Refrigerant Refilled (by gases)	2025/26 (MTCO₂eq)	2024/25 (MTCO₂eq)	% Difference
R22	106.6	106.6	0%
R32	87.1	130.7	-33%
R407C	-	55.1	-100%
R410A	129.3	347.9	-63%
Total	323	640	-50%

Scope 2 Emissions (Indirect Electricity)

Scope 2 emissions arise from purchased electricity from the national grid. During the year, these emissions declined to 3,839 MTC02eq, in line with lower electricity consumption corresponded with the reduced crane moves and the contribution of onsite solar generation.

Scope 3 Emissions

SAGT does not yet track all categories of Scope 3 emissions, but plans are in place to commence broader Scope 3 data collection from FY 2026/27. During the year Scope 3 emissions declined to 3,007 MTCO₂eq.

The Company currently monitors electricity consumed by refrigerated containers (reefers), which is treated as pass-through electricity paid for by shipping lines and excluded from Scope 2 totals. During the year, reefer related emissions reduced by 13% to 3,007 MTCO₂eq, mainly due to lower volumes handled.

Emissions Intensity and Decarbonisation Progress

SAGT calculates GHG emission intensity per QC move as a key performance metric.

Using 2019/20 as the base year, total emissions intensity has reduced by 21%, reflecting sustained progress over multiple years through cleaner equipment, efficiency gains and energy optimisation.

This long-term downward trajectory demonstrates that SAGT’s decarbonisation strategy is delivering measurable outcomes even amid fluctuating trade volumes and operational complexity.

The hybridisation of Rubber Tyred Gantry (RTG) cranes has continued to deliver meaningful fuel efficiency benefits while supporting lower emissions intensity and operating costs. These hybrid RTGs deliver approximately 54% fuel savings per move compared to conventional units.

Similarly, the deployment of two electric forklifts: one with a 3-ton capacity and another with a 5-ton capacity and an electric inspection vehicle in selected functions reflects the Company’s intention to gradually reduce dependence on conventional fossil fuel-powered assets. Compared to diesel-powered forklifts, each electric forklift achieves an 77% reduction in carbon footprint annually, making a meaningful contribution to emissions reduction. Similarly, the electric double cab purchased for the purpose of conducting safety inspections is expected to deliver an approximate 91% annual reduction in carbon footprint in comparison to a diesel powered vehicle.

The Company’s Environmental Protection Licence (EPL), issued by the Central Environmental Authority of Sri Lanka, requires annual monitoring of specific emissions arising from operational equipment such as Rubber Tyred Gantry cranes and diesel generators. In line with these obligations, SAGT engages independent third parties to conduct the required testing and verification exercises.

As at 31 March 2026, all monitored NOx and SOx emissions remained well within stipulated quality thresholds, and no violations of regulatory emission limits were recorded during the reporting period. This outcome reflects the effectiveness of equipment maintenance standards, fuel management practices and emissions control oversight.

SAGT recognises that energy transition in container terminal operations is a multi-year journey requiring technology investment, disciplined execution and collaboration across stakeholders. The Company’s next phase includes planned electrification of 30 Prime Movers, acquisition of four new energy-efficient Ship-to Shore cranes under green financing mechanisms by the end of 2027, and further automation alongside continued expansion of renewable energy opportunities.

By integrating resource efficiency with operational excellence, SAGT continues to strengthen its position as a responsible terminal operator contributing to lower-carbon trade logistics in Sri Lanka and the wider region.

Water and Effluent Management (GRI 303-1, 303-2, 303-3, 303-4 and 303-5)

Water is a shared and increasingly valuable resource. SAGT understands that climate variability, urbanisation and competing demand can place pressure on national water systems, making efficient water use an important business and societal priority

Responsible management of water resources and waste streams remains an important component of SAGT’s environmental stewardship agenda. As a major container terminal operating within the Port of Colombo, the Company recognises that efficient use of water resources are essential to minimising environmental impacts, maintaining regulatory compliance and supporting resilient operations. Although terminal activities are not water-intensive in the same way as certain manufacturing sectors, water is still a critical operational resource used across staff welfare facilities, kitchens, sanitation systems, cleaning processes, workshops and general site maintenance.

SAGT’s approach to water is therefore grounded in reduction, efficiency, compliance and continuous improvement. The Company continues to monitor consumption trends, identify opportunities for reduction. During the reporting period, these efforts contributed to measurable improvements in water conservation, while maintaining strong oversight over effluent management practices.

Water management is integrated into facilities maintenance and environmental oversight processes, with engineering teams responsible for system upkeep, leak detection and infrastructure reliability.

Effluent was discharged into the municipal council drainage system in the Port of Colombo, following verification that the discharge met the tolerance limits specified under the Environmental Protection License (EPL).

Water Withdrawal

The Company’s water stewardship strategy focuses on prudent withdrawal from approved municipal sources, reduction of avoidable losses, efficient internal use, monitoring of effluent quality and fostering employee awareness on conservation practices.

During the reporting period, total water withdrawal amounted to 44,207 m³, representing a 16% reduction compared with 52,488 m³ in the previous year. On an operational efficiency basis, this equated to a 7% reduction in water withdrawal per box move. All water withdrawals are fresh water from water non-stressed areas, as SAGT operates in Colombo which is not considered a water stressed area.

The reduction was primarily attributable to targeted leak identification and repair initiatives undertaken by the engineering department. Proactive maintenance of pipelines, fittings and distribution systems helped eliminate avoidable losses and improve overall water-use efficiency across the terminal.

In addition, the Company continued to conduct awareness programs encouraging employees to conserve water in washrooms, kitchens and welfare facilities. Behavioural measures such as promptly reporting leaks, avoiding unnecessary running water, and the mindful use of common facilities complement engineering interventions and help sustain long term reductions.

SAGT does not extract water from groundwater aquifers, seawater sources or surface water bodies, and does not currently engage in rainwater harvesting. While municipal supply remains sufficient for present needs, the Company continues to assess opportunities for future resilience measures that may support sustainable water sourcing over time.

Effluent Discharge

Effluent generated from sanitation systems, kitchens and related facilities is managed through established infrastructure and monitored processes. The Company takes care to ensure that wastewater handling does not create an adverse impact on the surrounding port environment or coastal ecosystem.

During the reporting period, total effluent discharge amounted to an estimated 27,962 m³, to water non stressed areas (more than 1000TDS). No violations were reported.

Effluent volumes are monitored daily, while testing is conducted quarterly by an independent third party. This external verification helps ensure that discharged water remains within required quality parameters and that any issues are identified early.

The operation of an oil-water separator ensures that water discharge from terminal activities meets stringent environmental standards by effectively removing oils and greases. The planned installation of an Effluent Treatment Plant, subject to site approvals, will most likely enable the reuse of treated wastewater for selected operations, potentially offsetting approximately up to 50% of current daily water usage and further strengthening water resilience.

Routine oversight of drainage systems, treatment interfaces and wastewater flows also supports operational reliability and environmental protection. Through these measures, SAGT seeks to maintain high standards of hygiene, compliance and responsible environmental performance.

Water Consumption

Water consumed within the terminal is largely linked to domestic and support uses rather than embedded within products or irreversible industrial processes. This creates opportunities for conservation through operational discipline, infrastructure upkeep and user behaviour. During the reporting 52 South Asia Gateway Terminals (Pvt) Ltd period, the water consumption amounted to 16,245 m³. There were no changes in the capacity of water storage tanks during the year.

The reduction in withdrawal during the year indicates that SAGT’s current management controls are delivering positive outcomes. The Company remains committed to maintaining momentum by:

• Continuing periodic leak detection and preventive maintenance
• Promoting responsible employee water-use behaviour
• Reviewing the efficiency of fixtures and plumbing systems
• Monitoring monthly trends for abnormal spikes in usage
• Evaluating future conservation technologies where practical

As climate resilience becomes increasingly important, prudent water stewardship will remain an ongoing focus area.

Waste Management and Circularity (GRI 306-1, 306-2, 306-3, 306-4, 306-5)

Waste management is another material area for SAGT, given the engineering intensive nature of terminal operations. Maintenance activities, packaging materials, food services and infrastructure upkeep generate a diverse range of waste streams including oils, batteries, tyres, metals, wire rope, paper, cardboard, plastics and food waste.

The Company’s waste strategy prioritises:

1. Reduction at source
2. Segregation by waste category
3. Reuse and recovery wherever feasible
4. Safe disposal of residual materials
5. Engagement of licensed recyclers and handlers
6. Employee awareness and accountability

This hierarchy supports both environmental outcomes and responsible resource use.

Waste Management Approach (GRI 306-1 and 306-2)

SAGT continues to manage waste in line with regulatory requirements and internal environmental controls. Waste is segregated at source into hazardous and non-hazardous categories, with further separation based on recyclability, recovery potential and safe disposal method.

Engineering and maintenance waste streams are closely monitored, given their scale and environmental sensitivity. Hazardous waste includes e-waste, used oil, contaminated cotton waste, batteries and chemical containers are stored, transported and processed through authorised service providers. Non-hazardous materials includes metals, tyres, cardboard and plastics are channelled for recovery and recycling wherever possible.

Internal awareness programmes continue to encourage proper segregation, housekeeping discipline and responsible disposal practices across departments.

During the reporting period, SAGT generated a total of 1,679,649 kg of waste, representing a 21.7% increase compared with the previous year. The increase was largely attributable to higher volumes of waste tyres and metal-related waste, including iron, tin, copper and wire rope and electronic waste.

Of total waste generated:

• 95% was non-hazardous waste
• 5% was hazardous waste

Hazardous Waste

Total hazardous waste generated during the year amounted to 82,157 kg, a marginal 0.25% increase from 81,954 kg in the previous year.

The reductions in waste oil and contaminated cotton waste can be linked to lower machine maintenance activity, as servicing intervals are based on running hours. Lower equipment utilisation during the year, therefore, translated into lower maintenance waste generation.

The increase in batteries reflected scheduled replacements and lifecycle renewals of electrical components and backup systems.

SAGT continues to ensure that hazardous waste is handled only through competent and licensed third parties in accordance with applicable regulations.

Non-Hazardous Waste

Total non-hazardous waste generated amounted to 1,597,492 kg, an 23% increase from 1,297,832 kg the previous year.

Tyre Waste

The sharp increase in tyre waste was linked to higher Prime Mover tyre replacements during the year. In response, the Company continued measures to reduce punctures and premature damage through:

• Improved housekeeping in operational yards
• Periodic magnetic sweeping to remove sharp metal objects
• Employee awareness of careful vehicle movement and reporting hazards

These preventative actions aim to extend tyre life and reduce replacement frequency over time.

Metal and Rope Waste

Higher volumes of iron, copper, tin and rope waste reflected replacement cycles of engineering materials and operational components. These materials generally carry high recovery potential and are channelled through authorised recyclers, supporting circularity objectives.

Engineering Waste

The reduction in engineering waste, including paper, cardboard and plastics, suggests progress in consumption control and practices in handling material.

Food Waste Management

Food waste represented approximately 4.15% of total waste generated during the year. Total food waste amounted to 70,000 kg, an increase of around 8% over the previous year.

The Company continues to conduct awareness sessions for employees on responsible food consumption and the importance of avoiding unnecessary waste. Food waste is managed through third-party channels for reuse as animal feed.

Waste Diverted from Disposal (GRI 306-4, 306-5)

SAGT continues to prioritise diversion of waste from landfill or unmanaged disposal through reuse and recovery pathways.

These figures demonstrate the substantial proportion of SAGT’s waste streams that continue to be channelled into beneficial reuse or material recovery pathways rather than disposal.

Supplier Environmental Assessment (GRI 308-1)

SAGT recognises that environmental responsibility extends beyond its terminal boundaries. Accordingly, the Company continues to strengthen environmental expectations across its supply chain and engages suppliers through self-declaration processes covering environmental and social compliance at onboarding stages.

Equipment suppliers, contractors, maintenance vendors, logistics partners and service providers all play a role in influencing the Company’s wider sustainability performance. Accordingly, responsible engagement in the supply chain continues to be an important component of SAGT’s environmental stewardship framework.

During the year, the Company streamlined its pool of significant suppliers based on the scope of goods and services they provide and initiated steps to strengthen environmental screening through supplier self-declaration mechanisms. These declarations are intended to confirm supplier awareness of and commitment to relevant environmental and social compliance expectations.

At the point of onboarding or registration, new suppliers and customers are required to complete self-declarations covering environmental and social responsibility matters. This process helps embed sustainability expectations early in the commercial relationship and encourages responsible conduct across the value chain.

SUPPLIER SELECTION AND ENVIRONMENTAL EXPECTATIONS

During the reporting period, no new environmental criteria were introduced in supplier selection, with the Company continuing to apply the established principles and requirements used in prior years. These criteria are designed to ensure that suppliers meet appropriate standards relating to quality, compliance, safety, service capability and responsible business conduct. 27 suppliers were assessed through environmental practice audits, even though no new suppliers were audited.

While no new criteria were added, SAGT continued to strengthen implementation practices and supplier engagement processes. SAGT strengthened supplier engagement and implementation practices by 54 South Asia Gateway Terminals (Pvt) Ltd maintaining a rigorous purchasing policy and a transparent supplier screening process incorporating sustainability criteria. All suppliers must adhere to the SAGT Supplier Code of Conduct.

FUTURE SUPPLY CHAIN PRIORITIES

Whilst adhering to the growing importance of Scope 3 impacts, ethical sourcing and resilient procurement, SAGT also intends to progressively strengthen the oversight of supplier sustainability in future years. Planned areas of focus include:

• Periodic audits of significant suppliers
• Stronger documentation of environmental compliance status
• Improved waste and materials traceability among service providers
• Engagement on low-carbon products and services where feasible
• Greater alignment between procurement decisions and sustainability priorities

By progressively integrating sustainability into supplier management, SAGT can amplify positive environmental outcomes beyond its own operations.

BIODIVERSITY AND PARTNERING FOR CONSERVATION

As a container terminal whose operations depend fundamentally on healthy oceans, functioning coastal systems and resilient trade routes, SAGT recognises that environmental stewardship must include protection of biodiversity and restoration of ecosystems. Marine and coastal environments face increasing threats from pollution, habitat destruction, climate change and unsustainable resource use. These risks have direct implications not only for ecological well-being, but also for maritime industries that rely on healthy seas and shorelines.

SAGT therefore continues to support practical conservation initiatives through partnerships with scientific institutions, government agencies and employee volunteers. These programs are designed to generate measurable environmental value while also raising awareness among employees and communities.

Broader Value of the Initiative

The beach clean-up program generated benefits beyond litter removal alone. These included:

• Reinforcing employee awareness on marine pollution
• Building a culture of volunteerism and environmental responsibility
• Strengthening stakeholder collaboration with national authorities
• Promoting family participation in sustainability initiatives
• Demonstrating SAGT’s commitment to coastal stewardship

By combining awareness, action and partnership, the program reflects how relatively simple interventions can create meaningful environmental and social value.

MANGROVE RESTORATION IN THE BENTOTA RIVER MANGROVE COMPLEX

Conservation Partnership: Yagirala Forest Reserve

SAGT’s commitment to ecosystem restoration predates the current reporting cycle. In 2019, the Company agreed with the Centre for Sustainability of the University of Sri Jayewardenepura to restore five acres of the Yagirala Forest Reserve.

This earlier initiative reflected the Company’s recognition that reforestation and habitat restoration can play an important complementary role alongside direct emissions reduction. The continued reference to Yagirala within SAGT’s environmental journey highlights a long-term approach to conservation rather than isolated one-off projects. Specifically, reforesting five acres within the reserve offsets roughly 9% of SAGT’s current carbon footprint.

Environmental expectations facing the maritime and logistics sector will continue to intensify in the years ahead. Customers increasingly seek lower-carbon supply chain partners. Regulators are tightening climate and environmental standards. Investors and lenders are paying closer attention to sustainability performance. Communities expect businesses to contribute positively to the environments in which they operate.

SAGT is well-positioned to respond to these shifts through a practical, data-driven and forward-looking stewardship strategy.

KEY PRIORITIES FOR THE FUTURE

The Company’s likely environmental priorities over the medium term include:

• Further decarbonisation through the electrification of operational fleets
• Acquisition of more efficient equipment supported by green financing
• Expansion of renewable energy generation capacity
• Broader Scope 3 emissions data collection and management
• Stronger supplier sustainability engagement and audits
• Enhanced circularity in materials and waste streams
• Ongoing biodiversity partnerships and nature-based climate action

As one of the region’s leading container terminals, SAGT has an opportunity to demonstrate that trade facilitation and environmental responsibility can progress together. Through disciplined operations, targeted investment and meaningful partnerships, the Company continues to reduce its environmental footprint while enabling efficient maritime commerce through the Port of Colombo.

Environmental stewardship is therefore not a peripheral agenda for SAGT. It is increasingly integral to resilience, competitiveness and long-term value creation. By staying the course on decarbonisation, resource efficiency and ecosystem protection, SAGT is helping shape a more sustainable future for Sri Lanka’s logistics sector and the wider maritime economy.